Tuesday, August 9, 2011

Rwanda Central Bank Holds Repo Rate at 6.00%

The National Bank of Rwanda held its key repo rate unchanged at 6.00%.  Bank Governor, Claver Gatete, said: "Considering current developments and outlook in economic fundamental, central bank monetary policy will remain accommodative to sustain lending to the economy consistent with the growth objective in 2011,".  The IMF previously noted that it is forecasting inflation of 7.5% for 2011 and cautioned the East African nation to tighten monetary policy in order to avoid second-round inflation effects of higher food and energy prices. 

At its April meeting the Bank also held the key monetary policy interest rate unchanged at 6.00%, meanwhile the bank last reduced the interest rate 100bps to 6.00% in November last year.  Rwanda has seen inflation pick up to 5.82% in June, compared to 4.54% in May, 4.98% in April, and 4.11% in March, and 1.09% in January this year.  According to IMF data Rwanda saw annual GDP growth of 5.39% during 2010, meanwhile the IMF recently scaled down its growth estimate for Rwanda to 7% for 2011, from a previous forecast of 7.5%.  


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