NAIROBI, July 29 (Xinhua) -- The Central Bank of Kenya (CBK) on Wednesday retained its benchmark lending rate at 7 percent, saying the policy measures implemented since March to combat the effects of COVID-19 in the economy were having the intended effects.

Patrick Njoroge, CBK governor who chaired the Monetary Policy Committee (MPC) meeting in Nairobi, said that actions already put in place will be augmented by implementation of the 2020-21 financial year budget.

"The MPC concluded that the current accommodative monetary policy stance remains appropriate, and therefore decided to retain the Central Bank Rate at 7 percent," Njoroge said in a statement.

He said that the committee met against a backdrop of the continuing global COVID-19 pandemic and measures taken by authorities around the world to contain its spread and impact.

Njoroge said the MPC, the apex bank's top policy organ, assessed the outcomes of its policy measures that have been deployed since March to mitigate the adverse economic effects and financial disruptions from the pandemic.

He said that the global economic outlook for 2020 remains highly uncertain, reflecting the unpredictability of the severity and persistence of the COVID-19 pandemic.

"After a sharp contraction in the first half of 2020, global economic activity is expected to recover gradually in the second half, mainly reflecting the impact of the lifting of COVID-19 containment measures and the effects of the fiscal and monetary policy measures put in place," Njoroge observed.

According to the apex bank, the economy remained resilient in the first quarter of 2020, mainly supported by agricultural production.

It said the leading economic indicators for the second quarter point to continued strong performance in agriculture, mainly due to favorable weather conditions and the lifting of restrictions in the key export markets.

However, against a backdrop of severe disruptions from the COVID-19 containment measures, the services sector remained subdued, particularly hotels and restaurants, and the education sector.

The governor said that despite the impact of the pandemic, exports of goods have rebounded, growing by 1.7 percent in the first half of 2020 compared to a similar period in 2019.

He noted that receipts from tea exports over this period increased by 18.4 percent with increased production while horticulture exports declined by 14.2 percent, largely reflecting the sharp contraction in flower exports in April. Enditem