Njoroge assures Kenyans that CBK is prepared to handle ‘Brexit’ aftershocks following Switzerland AGM

Central Bank of Kenya (CBK) Governor Dr. Patrick Njoroge has once again assured Kenyans that the regulator is prepared to handle almost any of the aftershocks likely to be experienced following Britain’s move to exit the European Union.

The Governor said in a statement yesterday that he had attended the just-concluded 2016 Annual General Meeting of the Bank for International Settlements (BIS) in Basle, Switzerland.

The affair was an occasion for central bank governors from around the world to discuss global financial developments and their implications. The meeting was dominated by discussions about the implications of the UK Referendum to leave the European Union, and the high volatility that was experienced in the global markets last Friday.

Central bank governors noted the contingency measures put in place by the Bank of England and other central banks to limit volatility and support the smooth operations of financial markets. Central banks will closely monitor markets.

“They have pledged to cooperate closely and take necessary action to ensure the orderly functioning of the financial markets,” Dr. Njoroge explained

“While the markets in Kenya operated normally last Friday, the CBK reiterates its readiness to intervene in the money and foreign exchange markets to ensure their smooth operations,” he added.

British withdrawal from the European Union, commonly referred to as Brexit is a political goal that has been pursued by advocacy groups and political parties since the United Kingdom joined the precursor of the EU in 1973. Withdrawal from the European Union has been a right of EU member states since 2007 under Article 50 of the Treaty on European Union. In 1975, a referendum was held on the country’s membership of the European Economic Community (EEC), later known as the EU.

The outcome of the vote was approximately 67% in favour of the country’s continued membership of the EEC. The UK electorate again addressed the question on 23 June 2016, in a referendum on the country’s membership.

The referendum was arranged by Parliament when it passed the European Union Referendum Act 2015. The result of this referendum held in June 2016 was 51.9 per cent in support of an exit (17,410,742 votes) and 48.1 per cent (16,141,241 votes) to remain.

The UK’s withdrawal is expected to take two years.

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