March 23, 2020 / 2:36 PM / 2 months ago

Kenya central bank cuts main lending rate to 7.25%

Kenya Central Bank Governor Patrick Njoroge addresses a news conference at the Central Bank of Kenya (CBK) headquarters in Nairobi, Kenya July 25, 2019. REUTERS/Stringer

NAIROBI (Reuters) - Kenya’s central bank cut its benchmark lending rate by 100 basis points to 7.25 percent on Monday to cushion the economy from the new coronavirus outbreak, its monetary policy committee said.

The bank also reduced the cash reserve ratio for commercial banks to 4.25% from 5.25%, saying the move will release an extra 35.2 billion shillings ($330.83 million) for lending to customers hit by the outbreak, the committee said.

The bank has also cut its 2020 economic growth forecast to 3.4% from an initial estimate of 6.2%.

Kenya, which is East Africa’s biggest economy, has 15 confirmed cases of coronavirus and its crucial tourism and farm exports businesses have already been hit by the impact of the outbreak.

($1 = 106.4000 Kenyan shillings)

Reporting by Duncan Miriri and Omar Mohammed; Editing by Catherine Evans

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