Kenya's parliament has confirmed on Wednesday Kamau Thugge’s appointment as the next central bank governor. The lawmakers approved President Ruto’s pick of the economist and senior civil servant for the role during a broadcast session.
Thugge, who served as the principal secretary in the Kenyan finance ministry, will succeed Patrick Njoroge, whose second four-year term ends on June 17. He was nominated to the position by the president last month after serving as one of his senior economic advisers since the end of last year.
The new governor, appointed for a four-year term, is expected to chair his first monetary policy committee meeting next month. According to media reports, at his confirmation hearings, Thugge stated that his priorities will include combating inflation, enhancing bank supervision and encouraging consolidation in the industry, as well as increasing support for micro-finance institutions.
Even though the Kenyan central bank’s main role is to ensure price stability, apart from that it’s mandated to provide support the government’s economic policies.
It was noted that Thugge is also planning to advance the integration of Kenya’s payments system with an intra-Africa trade platform that’s being promoted by the African Export–Import Bank.
The new governor takes over as the nation's central bank is struggling to curb inflation, with persistently high prices of energy and basic food commodities, and a slide in the nation’s currency. The shilling has plummeted 11% against the dollar since the start of the year, placing the nation among Africa’s 10 worst-performing currencies. At the same time, the inflation rate has exceeded 7.5%, the upper limit of the central bank’s target.
Despite these difficulties, the World Bank projects that country's economy will expand 5% this year and continue to stand at 5.2% on average in 2024-25 due to an expected decline in global commodity prices, robust private investment, as well as favorable weather conditions that will boost agricultural output.