BCEAO Cuts Key Rate to 3.25% to Stimulate Regional Growth

Jun 05, 2025 | Ecofin Agency
  • BCEAO lowers main rate from 3.50% to 3.25% effective June 16, 2025
  • Inflation eased to 2.3% in early 2025 amid stable macroeconomic outlook
  • Policy aims to support credit access and economic activity across WAEMU

The Central Bank of West African States (BCEAO) has lowered its key interest rate from 3.50% to 3.25%, effective June 16, 2025. The move, announced by Governor Jean-Claude Kassi Brou on June 4, is intended to stimulate economic activity in the West African Economic and Monetary Union (WAEMU).

The marginal lending facility rate was also reduced, from 5.50% to 5.25%, while the reserve requirement ratio remains at 3%.

The BCEAO attributes the monetary easing to a stable macroeconomic environment and a significant decline in inflation. Inflation in WAEMU fell to 2.3% in the first half of 2025, down from 2.9% in the fourth quarter and 4.1% in the third quarter of 2024. The bank credits this drop to improved market supply, moderate increases in import prices, especially energy, and previous monetary policy actions.

For 2025, the BCEAO projects average inflation at 2.2%, reinforcing the region’s stable economic outlook. “The fundamentals are encouraging in the medium term. Our external position has strengthened, and the current account deficit is virtually zero,” said Governor Brou.

The interest rate cut is expected to improve credit access for businesses and households, supporting growth across WAEMU member states. In contrast, the BCEAO had opted for caution in March 2025, holding rates steady despite favorable conditions. At that time, the Bank of Central African States (BEAC) had moved ahead with a rate cut from 5.00% to 4.50%.

Source: Ecofin Agency

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