Zimbabwe’s central bank cut its benchmark interest rate for the first time since becoming the world’s most aggressive monetary authority in June on expectations that a downward trend in inflation will continue.
The monetary policy committee lowered the rate to 150% from 200%, Reserve Bank of Zimbabwe Governor John Mangudya said in a statement Thursday, making it the second central bank on the continent after Angola to lower borrowing costs this year.
“The moderation in interest rates is important and necessitated by the downward trend in the month-on-month inflation since the last quarter of 2022,” he said. “The bank expects the downward trend in inflation to continue into 2023.”
Monthly inflation slowed from 12.4% in August to 1.1% in January and has been below the 3% target since November. Annual price growth slowed for a fifth straight month in January to 230%.
Drastic measures since June, including raising interest rates
You’ve reached your free article limit
Subscribe to enjoy unlimited access to trusted journalism. Cancel anytime.
Subscribe nowNeed help? molokom@insidepolitic.co.za
