Rwanda lowers benchmark interest rate

Dec 29, 2016

The reduction in benchmark interest rate will motivate lending

For the first time since 2014, the Rwanda central bank has lowered the benchmark interest rate to spur economic growth and motivate lending as inflation eased. The benchmark interest rate was reduced to 6.25 percent from 6.50 percent by the Monetary Policy Committee after leaving it unchanged since June 2014. "The lowering of the key repo rate is to signal the banks to increase lending to the private sector and support growth," Governor John Rwangombwa on Wednesday in Kigali. "Rwanda's central bank forecasts the inflation rate at about 6 percent by the end of 2016 after it slowed to 6.4 percent in November from 7.4 percent in October. Economic growth may also decelerate to 6 percent this year, from 6.9 percent in 2015" Rwangombwa added.