Archive for February, 2009

Several emerging – market economies including Brazil, Chile, Czech Republic, Indonesia, Turkey and South Africa have adopted inflation targeting as their institutional framework for conducting monetary policy.



Initially adopted by New Zealand in 1990, the norms surrounding the inflation targeting regime have been so powerful that virtually all Central Banks have declared that maintaining price stability with inflation in the “low single digits” is their only mandate. The desire for zero or very low inflation rates is therefore the focal point in both developed and developing economies.



In Africa, South Africa and Ghana have adopted an inflation targeting monetary policy. Kenya is quickly moving towards adopting inflation targeting monetary policies to ensure inflation levels are reduced and maintained at low levels. This will imply a shift from a money-growth targeting framework to inflation targeting framework in Kenya.



The IMF has supported the Central Bank of Kenya’s plans to reform the monetary operations framework including the introduction of Inflation targeting – under certain conditions including:  further develop its data collection, analytical capabilities and infrastructure, institutional and statistical reforms – specifically, the arithmetic basis of computing the CPI (Consumer Price Index).



I am very interested in this paradigm shift in Kenya’s monetary policy. A few questions come to mind including the following:



  • Will Kenya’s macroeconomic environment benefit from a shift from a money-growth targeting to an inflation-targeting
  • Which factors are systematically associated with Kenya’s decision to adopt an inflation targeting monetary framework?
  • What structural trade-offs (if any), will need to be addressed as concerns monetary and fiscal policy in Kenya.
  • How should Kenya go about the shift from a money-growth framework to an inflation targeting framework?
  • What lessons can the Central Bank of Kenya learn from emerging economies that have successfully adopted inflation targeting frameworks?



Should Kenya even move towards adopting inflation targeting or should the CBK explore other alternatives to inflation targeting e.g. real targeting approaches where policies are geared toward “holistic” macro-economic development including job creation, poverty alleviation while maintaining moderately low inflation levels?


I hope to find answers to these questions in the next few years…..That is a journey I have embarked on…… 🙂


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Some day, I hope someone can stand and say – “Cynthia mentored me well”. Sometimes all you need in life is one person that believes in you; believes in you enough to want to bring out the best that you can possibly offer. That usually can make all the difference in someone’s life. My note below speaks, in a long convoluted kind of way about 2 men that truly mentored my banking career path.


They inspired me, they believed in me and they pushed me to be what I am today and what I am yet to become – I believe the best is yet to come! I truly believe they were God-sent and came into my life at the right time!



I had a great mentor when I first embarked on my first “real job” out of college a few years ago.


It so happened that our crop of “young Turks” a.k.a. – freshly minted college grads that were recruited into B.O.B in that particular year were the result of a “wind of change” that blew in the bank’s philosophy concerning employee standards. Plainly put, they were getting rid of the old school of thought! I think that’s as nice as I can get.


So we waltz in, full of ideas, eager to begin making a living away from our folks. We of course are sent to different branches of the Bank in different cities in Kenya. I land at one of the smaller branches in Nairobi and I am ok with it – though I had really wanted to go to the head office a.k.a home office. Of course we are being paid peanuts compared to our predecessors, who were basically given ultimatums – voluntarily retire, or you have no job! But its ok – most of us know this is just a stepping stone – if you play your cards right 🙂


Some Asides:

On one of my interviews, I had secured a place to stay, paid the deposits required and basically prepared myself to move in (Yah, I was that confident about getting the position!). I also was vehemently determined not to live with relatives or my parents friends or my friends etc. I was determined to make it “my life” from the onset!

I left the Interview – my last interview, walked on to my next appointment at the Embassy of Italy in Nairobi (I was a busy woman though not “officially” employed! Lol!), and got “the phone call” as I prepared to cross, rather forcefully cross our beautiful Nairobi Streets – I still “miss” the intermingling of human beings with cars so fearlessly on Nairobi Streets!

The phone call basically said – return to B.O.B and pick up some forms to be delivered to the Kisumu Branch the day after tomorrow, where you shall also have your medical screening – The rest is History!

When I was finally ready to begin working at B.O.B, a month after that last interview, My Mummy, made the trip with me amidst my protesting that I was a grown woman 🙂 , I guess also make sure she knows EXACTLY where to find me. Lol! So we get to my new home and she makes sure I have the basics  etc….Oh how sweet! And she was even more assured when she noticed there was a 24-7 Askari on premise 🙂

Some day when I am a mother, maybe I will understand what she was going through Much like understand what she went through putting my younger sister P_____ on a plane to the US of A, by herself a few years earlier!.



So my first day at the Bank is big fuzz – we had a branch manager that liked to take his time – and he did take his time before seeing me J . I learnt the basics, the bank systems, what’s kept where, who is who etc.


Another Aside:


At the end of my first week, this man, with his desk right next to mine,that had barely said two words to me the entire week walks up to me during Chai ya Saa Tisa ( Afternoon Tea) after the Bank doors close and offers to buy me a beer  – Like that is supposed to what – get me impressed? I can buy my own- whatever-I drink Thank You!– I think I gave him “the look” coz he volunteered to extend the offer “maybe next week”.


My second week begins, and my boss Mr. W_____, pulls me aside and tells me he has decided to do some things differently. That marked the beginning of a change in my career life. He was very diligent about making sure I understand what we are doing vs. just doing it. Instead of merely posting a foreign bill for collection, a letter of credit, FX transaction, Repo transactions with the CBK etc – he made sure the concepts were ingrained in me. You see there is a big difference waltzing out of business school with theories and actually putting those into actions! He allowed me build that bridge effectively and efficiently and confidently – at am amazing speed! I am forever grateful to Mr. W_____! That’s as much as I can say! I remember a day during a transition of the bank where only three of us worked – we were dog tired at 3pm – but we managed!


My branch was amalgamated into the Head Office three months after I joined the Bank ; And I found myself in uncharted waters – and in the very dreaded Reconciliation Department! However, I also quickly discovered that I was able to work in ANY of the departments – FX and Trade Finance, Business and Personal Banking, Clearing, Reporting etc at the drop of a hat – in just three months!!! I delved in and quickly figured out that I actually enjoyed all this foreign banking stuff a.k.a nostro and vostro account reconciliation, currency revaluations, CBK reporting etc and it also became evident to the “big boyz” upstairs.


My role changed from that of merely being a “doer” to that of being “consulted” on multiple issues. I quickly was separated from the “pack” and moved on to doing tougher things. Lol!


And therein, came in my second mentor, a Mr. T_____ B_______. You see, he has LONG, unpronounceable names – so for the sake of Sanity, he agreed to people thoroughly shortening his names, else we were just going to call him “Nani!” Lol! The version of his names we used was actually his first name, broken into two shorter names……




Mr. T______ was this short guy, very geeky and intelligent (yes you can be geeky and dumb!). He walked and talked hyper fast and expected that from the people he worked with. My close interactions with him began when the then, Reconciliation Manager was close to retirement. We had this one report, sent to the home office in Mumbai on a fortnightly basis – seeing as the bank had close to 3000 branches in India and a presence in 15 or so other countries – no-one volunteered to learn the reporting – But I did. Doing it for the first time – I realized I had made a big mistake – but there was not backing out now! The first report took me 14 – 20 hours to complete!! But with time, it made sense…and I was easily able to complete a report in 4 hours J


So, having delved into something complex, Mr. T_____ naturally wanted me on his team, team of 3, to aid in the development and implementation of a new reconciliation system. I worked LONG hours, Forget your 9am to 3pm bankers hours!  – I also worked Saturday 9-6pm. ( typically). I went to Church on Sunday  morning and went to the Office in the afternoon, I filed (for my own good lest docs disappear as I wait for other people to do their jobs!), I accompanied Mr. T_____ on training trips for other branches, and finally, I was able to run alone with the system J No mean achievement!


So when Mr. T_____ said some nice things to our “biggest guy” upstairs in the corner most office – a big step up awaited me – but it meant leaving Nairobi, and moving to Kisumu. I had only visited Kisumu previously but I wasn’t too opposed to relocating either. So I said yes. 3 months later, a complete shock to everyone else, I got ready to relocate.


Yah – culture shock! B.O.B Kisumu was WAY LAID BACK – the pace, the attitude, etc… I was used to FAST, and this wasn’t fast enough for me! PLUS – I had a colleague, Mr. S______ that totally DISLIKED me!


First, he couldn’t understand why “ a young girl” was sent to the branch to Head something, anything!, He had issues with my knee length or slightly above knee length skirt suits, he was pissed that I could work in any department, and was pissed that he was NOT my boss! Ha! What to do! He once tried to stop me from attending a cocktail party for the bank’s top clients, clients I HAD to get very familiar with, coz he felt someone “more mature” needed to attend – the nerve that man had! Too bad for him none of his anti – me schemes prevailed and I did have the last laugh!


I also discovered that some of my colleagues, the young Turks, did not know nearly as much as I did due to the work ethics that one Mr. S_____ had instilled in the Branch operations. You were basically supposed to DR and CR as told without undue questioning. W.T.H! Obviously, he had a lot of clout, judging from the subservient nature of most people. To this day, I still say shame on him for embracing such myopic and backward standpoints especially regarding people that were young enough to be his children!


Those that know me – know that I do not really care to speak a lot, but when I do, I do make my point very CLEARLY! And I guess I did…he learnt to tolerate my “Nairobi Attitude” as he told anyone who cared to pretend to listen to him J


My stay in Kisumu was short lived – I left to go to Grad School – but I made an awesome friend C_____ who basically taught me a few things about living in Kisumu City 🙂 that made my short stay totally worth it!


I thank Mr. W_____ and Mr. T_____ for believing in me and for allowing me my “me-ness” at the onset of my career! I am truly blessed to have met two amazing mentors like you!  Some day, all I can hope for is that someone will say something like that about me…….

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