Zambia central bank has decided to keep the benchmark interest rate unchanged at 9.75%. This was announced by Bank of Zambia Governor Dr. Denny Kalyalya in a press brief in Lusaka the capital. This followed two days of monetary policy meeting deliberations and consultations with stakeholders that commenced Monday 19 Nov through to 20 Nov.
After weighing in the risks to growth the BOZ felt there was need for stimulus efforts to grow the economy, the committee decided to maintain current policy stance. The BOZ cited tamed inflation reflective of the recent current depreciation of the kwacha which has been successfully arrested and the fuel price hike. The BOZ projects that inflation will close the Q4 within a single digit and target band of 6-8%.
Further, in light of the fiscal hurdles the economy is facing there’s no room for further easing in monetary policy, the BOZ intimated.
However the central bank is cognizant for the international market risks ranging from such as slowdown in global growth evidenced by softer PMI’s in China to geopolitical tensions in the middle east that could threaten crude prices in the immediate to long term.
The next review will be in February 2019.