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Kigali Hikes Up the Interest Rate

Rwanda’s central bank unleashed its biggest interest-rate hike in more than 13 years as runaway inflation caused it to revise its forecasts upwards. The monetary policy committee (MPC) increased the key policy rate to 6% from 5%, governor John Rwangombwa said in the capital, Kigali. That’s the most since January 2009 and takes the cumulative rate increases for 2022 to 150 basis points. The MPC decided to hike to avoid second-round inflation effects and expects the increase, together with other measures coming from government, to bring the rate of price growth back within the central bank’s target range of 2% to 8% in the second half of next year, the governor said.

SOURCE: BUSINESS DAY LIVE