Central Bank of Kenya (CBK) Governor Kamau Thugge has expressed optimism that a new loan programme with the International Monetary Fund (IMF) will help attract more foreign investment and strengthen the country’s macroeconomic stability.
Speaking on Wednesday during the IMF/World Bank Annual Meetings in Washington, D.C., Thugge said the government is in talks with the IMF for additional funding under a new programme. He noted that maintaining an IMF-supported framework is key to sustaining economic stability and boosting investor confidence.
“Having a programme supported by the IMF is critical to sustaining this macroeconomic stability,” Thugge told Bloomberg. He added that such support not only reassures investors but also encourages financing from other multilateral lenders like the World Bank and the African Development Bank.
The Kenyan shilling, currently trading at Ksh129.23 against the US dollar, has remained steady for nearly a year. Thugge attributed this stability to sound monetary policies, easing inflation, and improved lending conditions. Inflation has dropped below the 5 percent target, while core inflation stands at 2.9 percent, signaling controlled price pressures.
Thugge revealed that easing monetary policy has begun to stimulate private sector lending. “In January, credit to the private sector was at negative 2.9 percent, but by September it had risen to 5 percent,” he noted.
On the IMF engagement, Thugge clarified that Kenya seeks normal access within the 600 percent limit of its IMF quota, having already utilised 536 percent. “We just expect normal access and aim to repay this in three years to create space for future access,” he said.
He emphasized that continued IMF support would reduce domestic borrowing, ease pressure on interest rates, and allow businesses to access more affordable credit strengthening Kenya’s economic resilience and investor appeal.