Britain’s vote to leave the European Union, commonly referred to as ‘Brexit’, will slow down Kenya’s trade between the EU and the UK since two different regimes will be involved, Central Bank Governor Patrick Njoroge has said.
“Uncertainties in the global economy have increased with Brexit, it has sparked global financial volatility and a sharp depreciation of the Sterling Pound,” Njoroge explained.
He added that it is not clear what the outcome will be but so far, Kenyans have not yet been affected. He urged investors to be more cautious.
“Our exports will be under a higher tariff regime, exporters maintain your market share there is great sensitivity to the issue,” Njoroge said.
The governor was addressing the media during a bi-monthly briefing at the CBK headquarters. He said that overall inflation increased to 5.8 per cent in June 2016 from 5.0 per cent in May but remained within the government target range.
“Our inflation remains out of control, it is true it has increased, this increase was largely due to prices of some food items such as tomatoes, Irish potatoes and cabbages,” said Njoroge.
Njoroge noted that no-food-non-fuel (NFNF) inflation declined to 5.0 per cent in June from 5.4 per cent in May
“This indicates that there were no significant demand pressures in the economy,” said Njoroge. He noted that the banking sector continues to stabilise with improving liquidity conditions and non-stable non-performing loans in May and June.
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