banks

The National Bank of Rwanda (BNR), Rwanda’s central bank, lowered its repo rate on Thursday to 5.5 percent from 6 percent, the bank governor said.

The key repo is the rate at which the central bank lends money to commercial banks.

The decision followed the Monetary Policy Committee (MPC) and Financial Stability Committee (FSC) quarterly meetings from Dec. 27 to 28, said governor John Rwangombwa at a news conference in the Rwandan capital Kigali.

“The committee has decided to reduce the key repo rate to 5.5 percent in the first quarter of 2018 from 6 percent to continue supporting the financing of the economy,” said Rwangombwa.

He added that the headline inflation has reduced to 2.2 percent in November, down from 6.4 percent in the same period last year, due to stability of exchange rates and positive performance in the monetary aggregates.

“We shall continue reducing the policy rate to further support the financing of the economy by the banking sector as long as our financial sector remains sound, stable, profitable and able to stand external shocks,” said Rwangombwa.

Rwanda’s trade deficit reduced by 21.1 percent in the first eleven months of 2017 compared to the same period of 2016, as a result of the significant increase in formal exports value and a decrease in formal imports, according to the central bank.

Rwangombwa noted that the depreciation of Rwanda francs against the U.S. dollars is expected at 3.07 percent by end of December, compared to 9.7 percent last year.

Rwandan economy grew by 8.0 percent in the third quarter of 2017 compared to 5.4 percent in the same time last year.

However, the committee noted that in sub-Saharan Africa, economic growth is projected to increase to 2.6 percent in 2017 from 1.4 percent in 2016, in line with a recovery in international commodity prices. Enditem

Source: Xinhua/NewsGhana.com.gh

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