IMF Sees Kenyan Bank-Loan Rate Cap Blunting Monetary Policy

  • Legislating borrowing costs doesn’t work, IMF cautions
  • New law seen hurting lenders with exposure to small businesses

Kenya’s decision to limit the rate that commercial banks can charge for loans will cloud the central bank’s monetary policy signals and may undermine efforts to keep inflation within the government’s target range, the International Monetary Fund said.

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