Kenya’s central bank governor said on Tuesday the oil price spike caused by an attack earlier this month on Saudi Arabia’s largest oil processing facility would have little impact on inflation.
Patrick Njoroge told a news conference in Nairobi that the spike “won’t have a significant impact on inflation”.
Njoroge said the central bank still expected the economy to grow by six per cent this year, citing good performance in the tourism sector, a top hard currency earner and employer in the East African economy.
He added the central bank would review that growth forecast after the statistics office issues growth numbers for the second quarter at the end of this month.
He warned, however, that there were significant risks, including the U.S.-China trade war and the ensuing softening of the global economy.
“The external sector is worsening dramatically,” he said.
The governor reiterated policy makers’ view that ongoing efforts to tighten the government’s fiscal policy could lead to monetary easing.
The bank held its benchmark lending rate at 9.0% on Monday, saying inflation was well anchored within the government’s preferred range and that the economy was operating close to its potential.
