NCBA Group has cut its forecast for Kenya's economic growth this year to 4.8 per cent, from an earlier 5.1 per cent. The lender presented the revised outlook on Tuesday at the NCBA Economic Forum 2026 in Nairobi, The Eastleigh Voice reported. It expects growth of between 4.0 and 5.0 per cent in 2027, supported by investment, structural reforms and stronger productive capacity.
The bank blamed the weaker outlook on global political tensions, swings in commodity prices, changing weather patterns and the upcoming General Election. It warned that external shocks and tight public finances could undermine the economy's recent momentum.
NCBA Group Managing Director John Gachora said the economy had stayed resilient. However, he warned that its ability to absorb repeated shocks was shrinking. He listed the crisis in the Middle East, the Russia-Ukraine conflict, sudden monetary tightening in several key economies and volatile sovereign bond markets. "Our capacity to absorb successive shocks is not limitless," Gachora said.
Treasury CS John Mbadi gave a more upbeat forecast for 2027. He said the government projects 5.1 per cent growth, with inflation within target and a stable shilling. According to Mbadi, the economy grew by an average of five per cent between 2022 and 2025. Inflation stood at 7.3 per cent in October. The shilling traded at an average of KSh 129.9 to the dollar.
Mbadi warned that spending pressures continue to strain government resources. He named interest on domestic debt and pension obligations as the main ones. He urged banks to pass on interest rate cuts and lend more to businesses, farmers and small enterprises. He noted that the Central Bank Rate has fallen from 13 per cent in mid-2024 to 8.75 per cent. Average lending rates, however, remain at 14.4 per cent. He said reforms include risk-based loan pricing anchored on KESONIA and changes to the Credit Guarantee Scheme to unlock lending to SMEs.
David Ndii, President William Ruto's economic adviser, pointed to better performance in agriculture and manufacturing. He cited higher milk, sugar and coffee output and rising vehicle registrations. Ndii said Kenya is tracking an investment pipeline worth about $45.7 billion across infrastructure, manufacturing, agriculture and ICT. The government is also pursuing a proposed National Infrastructure Fund, which is expected to raise $10 billion.