The Central Bank of Kenya (CBK) undertakes a Market Perceptions Survey, prior to every Monetary Policy Committee (MPC) meeting to obtain perceptions of banks and non-bank private sector firms on selected economic indicators including inflation, economic growth, demand for credit, growth in credit to private sector and exchange rate.
The highlights of the January 2021 Market Perceptions Survey include:
- Optimism in the country’s economic prospects has increased further with the re-opening of learning institutions. In particular, 93 percent of banks and 74 percent of non-bank respondents were optimistic on the economic prospects in 2021.
- Respondents expect economic activity to increase in January and February. In the Survey, 98 percent of banks and 76 percent of non-bank respondents expected moderate to strong economic activity in January and February 2021, compared to only 82 percent and 69 percent, respectively, in November and December 2020.
- Employment rate was expected to increase in 2021 as the business environment improved and as demand in economy the normalises.
- Banks expect an increase in private sector credit growth in 2021, with expected recovery of key sectors affected by COVID-19 and Government policy interventions including the operationalisation of a Credit Guarantee Scheme for the MSMEs.
- Inflation expectations remain anchored, with both bank and non-bank respondents expecting overall inflation to remain within the target range in January and February 2021.
Read the full report here