The impact of Macro-Prudential Policy With low interest rates unable to constrain credit growth, rapid house price inflation was creating financial stability risks for the banking system and, given the very high levels of household debt, increasing the risk that a rapid fall in house prices could have a severe economic impact.
Ladies and Gentlemen: The Central Bank of Kenya together with sister Central Banks of the East African Community (EAC): Uganda, Tanzania, Rwanda and Burundi, on May 10th 2010, committed to conducting diagnostic surveys to clearly identify the demand and supply constraints in accessing financial services. This commitment was made during the 13th Governors’ Meeting of the Monetary Affairs Committee (MAC) of the EAC.