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Cheap flour cuts inflation to 4.7pc 5-month low

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Cheap flour cuts inflation to 4.7pc 5-month low

Workers arrange maize flour
Workers arrange maize flour at Tuskys Supermarket on Kenyatta Avenue, Nairobi. The price of the staple is likely to rise next week. FILE PHOTO | NMG 

Cheap maize flour helped cut inflation to a five-month low of 4.7 per cent in January when electricity and transport costs increased.

The Kenya National Bureau of Statistics (KNBS) Thursday said inflation fell from 5.71 per cent a month earlier, offering a relief to consumers who were burdened with education-related costs at the start of the first term.

“The cost of several foodstuffs in January 2019 was much lower compared to the same period of the previous year,” KNBS director-general Zachary Mwangi said in a statement.

KNBS data shows a kilo of maize grain dropped 40 per cent to Sh35.23 over the past year while a two-kilo packet of maize flour fell by Sh35.68 to Sh87.20 in the review period.

Maize flour, Kenya’s staple, is retailing at levels last seen in 2012, on increased maize harvest—which was projected at 46 million bags.

This broke the trend where harvests have been declining since 2015. This points to an easing of the food crisis that has for the past two years forced Kenya to rely on imports to meet its needs for the staple food.

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A kilo of sugar and beans fell Sh10.16 and Sh7.03 respectively compared to a year earlier. But electricity, rent and transport costs were higher compared to January last year.

Households consuming 200 units of electricity paid Sh416.30 more in January compared with the Sh4,485.52 they paid last month.

Rent for a single room also went up by Sh195.45 to stand at an average of Sh4,456.98 compared with January 2018.

Long distance transport costs dipped marginally after the Christmas season but remained higher than last January’s.

Bus fares for 350km journey, which is equivalent to Nairobi-Kisumu trip, stood at Sh1,239 last month compared to Sh1,245 in December and Sh1,074 in January last year.

“The housing, water, electricity, gas and other fuels’ index increased by 0.20 per cent as a result of higher cost of house rents and cooking fuels,” Mr Mwangi said.

The price of diesel, a key commodity used to run farm and industrial machines as well as in public transportation, fell by Sh8.79 per litre on average compared with December.

Petrol, on the other hand, retailed at Sh9.97 less to average Sh104.99 per litre in January, reflecting lower cost of petroleum products landed at the Port of Mombasa due falling global crude oil prices amid a stable shilling.

The two commodities, however, traded slightly higher compared with January 2018 as the impact of eight percent value added tax (VAT) last September is yet to be cancelled out.

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World Bank pushes G-20 to extend debt relief to 2021

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World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.

“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.

He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.

The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.

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People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.

For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.

Debt burdens, already unsustainable for many countries, are rising to crisis levels.

“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.

ALSO READ:Global Economy Plunges into Worst Recession – World Bank

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Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans

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The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.

“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”

According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.

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Tighter Reins on Platforms for Mobile Loans

The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.

Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.

Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.

SEE ALSO: Central Bank Unveils Measures to Tame Unregulated Digital Lenders

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Scope Markets Kenya customers to have instant access to global financial markets

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NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options. 

This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.

The Scope Markets app offers clients over 500 investment opportunities across global financial markets.

The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.

The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).

The platform also offers an enhanced client interface including catering for those who trade at night.

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The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour;  Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).

The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.

Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”

He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.

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