Monday, June 13, 2011

Mauritius Central Bank Raises Interest Rate 25bps to 5.50%

The Bank of Mauritius raised its repo rate by 25 basis points to 5.50% from 5.25% due to rising inflation.  The bank said: "MPC members felt that, with the output gap nearing zero and underlying inflationary pressure not showing signs of abating, the process of normalizing the key repo rate should be continued," ..."The MPC considered it important to prevent the high consumer price inflation from generating second-round effects."

Previously the Bank of Mauritius raised its repo rate by 50 basis points in March this year to 5.25%.  Mauritius reported inflation of 7.2% in March this year, and 6.8% in February, compared to the Bank's previous forecast that inflation will rise to 7% in June.  The Bank expects the economy to grow 4.6% this year, having recorded annual GDP growth of 4.4% in 2010.


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