Economy: Kenya
Key Facts
—Who. The Monetary Policy Committee of the Central Bank of Kenya (CBK), which sets the benchmark interest rate.
—What. Kept the Central Bank Rate at 8.75% on Wednesday 7 October 2026, the fourth hold in a row.
—Where. Nairobi, Kenya’s capital and financial centre.
—Numbers. Inflation was 6.8% in September (6.6% in August), inside the 2.5% to 7.5% target range. The bank expects 5.0% growth in 2026.
—US link. A steady shilling, about 130 to the US dollar, matters for US holders of Kenyan debt and for dollar-priced fuel imports.
—As of. 7 October 2026, 22:30 GMT.
Kenya’s central bank kept its benchmark lending rate at 8.75% on Wednesday 7 October 2026. It was the fourth hold in a row, and inflation edged up to 6.8%, closer to the top of the official target range.
What We Know
The Monetary Policy Committee of the Central Bank of Kenya retained the Central Bank Rate at 8.75% at its meeting on 7 October 2026. The rate has not moved since the bank last cut it on 10 February 2026.
Inflation rose to 6.8% in September from 6.6% in August, the bank said. That is still inside the official target range of 2.5% to 7.5%, but closer to its upper limit.
The committee projected that the economy will grow 5.0% in 2026, led by industry and services. It also said global growth is likely to moderate this year because energy prices have risen with the conflict in the Middle East.
Commercial bank lending to the private sector grew 10.6% in September, up from 10.3% in August, according to the bank. Average commercial lending rates were about 14.3% in August, which shows how far loan prices sit above the benchmark.
On the day of the decision, the bank quoted the shilling at 129.89 per US dollar. That means KSh1,000 is worth about US$7.70.
Why the Bank Held Steady
The Kenya Bankers Association, the lenders’ lobby group, had urged a hold before the meeting. Its research centre recommended keeping the rate at 8.75%.
Kenyans.co.ke, a popular Nairobi news site, called the decision a relief for borrowers and businesses seeking loans. It noted that the bank last reduced rates on 10 February.
Energy prices are the main outside risk the committee named. Higher oil prices typically feed into transport and food costs, which is why the bank is watching them.
What Is Not Known
The committee gave no clear signal on whether its next move will be a cut or a rise. We could not confirm the date of the next meeting from the bank’s decision notice.
This report covers the headline decision and the figures the bank has published. It does not assess foreign-exchange reserves or the current account, which readers can find in the bank’s full release.
What It Means for US Readers and Investors
A steady shilling matters to US investors holding Kenyan debt and to importers who pay for fuel in dollars. The central bank’s quoted rate of 129.89 shillings per dollar is the reference point to watch.
For travelers and expatriates, a stable currency keeps prices in Nairobi and Mombasa predictable for now. With inflation near the top of the target band, that picture could change if oil prices stay high.
We previewed the decision in our Kenya rate outlook earlier this week. Our Ghana economy guide covers another African economy watching inflation and the oil price.
Frequently Asked Questions
What is Kenya’s interest rate now?
The Central Bank Rate is 8.75% after the decision of 7 October 2026. The bank last cut it on 10 February 2026.
Why did the Central Bank of Kenya not change the rate?
Inflation of 6.8% is still inside the 2.5% to 7.5% target range. The bank is also watching energy prices linked to the Middle East conflict.
What does the decision mean for loans in Kenya?
The benchmark that guides loan pricing is unchanged. Average commercial lending rates were about 14.3% in August.
How strong is Kenya’s economy?
The bank projects 5.0% growth in 2026, led by industry and services. Private-sector lending grew 10.6% in September.
Sources
Central Bank of Kenya (MPC decision, 7 October 2026) · Kenya Bankers Association · Kenyans.co.ke
Cover photo: Haile Selassie Avenue in central Nairobi, August 2025. Photo: Bahnfrend / Wikimedia Commons (CC BY-SA 4.0).
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief
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