Kenya cuts benchmark rate to three-year low
Kenya’s central bank has reduced its benchmark interest rate by 25 basis points to 8.75 percent, marking its tenth consecutive cut and pushing borrowing costs to their lowest level in three years. Governor Kamau Thugge said the move reflects easing inflation and improving macroeconomic stability.
The decision aligns Kenya with a broader easing cycle across parts of Africa. Angola lowered rates to 17.5 percent, Ghana cut sharply to 15.5 percent, and Mozambique trimmed borrowing costs to 9.25 percent. However, Uganda, South Africa and Tanzania held rates steady.
Why it matters
Lower rates are designed to stimulate lending, support businesses, and ease household debt burdens — but they also test central banks’ ability to maintain currency stability.
Egypt cuts rates again as inflation cools
Egypt’s central bank has cut key interest rates by 100 basis points, bringing borrowing costs to their lowest level since mid-2023. The move marks a second consecutive reduction as inflation moderates and the pound stabilises following last year’s sharp devaluation and IMF-backed reforms.
Policymakers say the focus is shifting toward reviving growth and private-sector investment after a prolonged tightening cycle that saw record-high rates.
Why it matters
Sustained rate cuts could signal confidence in Egypt’s economic stabilisation, but authorities must balance growth ambitions with lingering inflation risks.
Ethiopia launches sweeping foreign exchange reform
Ethiopia has introduced major amendments to its foreign exchange regime, easing long-standing restrictions on access to and transfer of foreign currency. The National Bank of Ethiopia’s new directive removes several capital controls and expands foreign-currency access to households and businesses.
The reform aims to boost investor confidence, formalise FX inflows and reduce reliance on parallel markets that have long distorted trade and investment.
Why it matters
The changes mark one of Ethiopia’s most significant financial liberalisation moves in decades and could reshape capital flows, investment dynamics and currency stability.
US stock trading tops $1 trillion daily despite calm markets
US equity turnover has exceeded $1 trillion per day on average, even as market volatility remains subdued. Bloomberg Intelligence data show daily share turnover reached a record $1.03 trillion in January, up roughly 50 percent year-on-year.
Analysts attribute the surge partly to rising stock prices — including a 15 percent gain in the S&P 500 over 12 months — as well as structural shifts such as algorithmic trading and increased retail participation.
Why it matters
Elevated trading volumes point to deep structural changes in market behaviour, with greater liquidity potentially amplifying both gains and future shocks.
Equity Bank cuts lending rates after Kenya easing
Equity Bank, Kenya’s largest lender by assets, has reduced rates on Kenya shilling variable loans following the central bank’s rate cut. New loans will now be priced at the prevailing benchmark rate of 8.75 percent plus a customer-specific premium.
Existing variable-rate borrowers will see the benchmark component fall after a 30-day notice period.
Why it matters
Commercial banks transmitting rate cuts to customers suggests monetary easing is feeding into the real economy, potentially lowering borrowing costs for businesses and households.
