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Reserve Bank of Zimbabwe (RBZ) Governor Dr John Panonetsa Mangudya has exclusively revealed to TechnoMag the intentions of the Monetary Policy Committee MPC which he chairs, to resolve the current 200% and 100% bank policy rate and medium-term lending rate.
In a Statement Dr Mangudya sent to TechnoMag, the Governor said, “[The committee] resolved to maintain the Bank policy rate and medium-term lending rate at current levels of 200% and 100%, respectively and to review the interest rates in the first quarter of 2023 as dictated by inflation developments,” Mangudya said.
Dr Mangudya said, The Committee agreed to further liberalise the foreign exchange market in the first quarter of 2023 and to enhance efficiency in the operation of the foreign exchange auction system and the willing-buyer willing-seller foreign exchange mechanism.
As the Chairperson of the MPC, Mangudya noted his committee also agreed to continue supporting the productive sectors of the economy through the Medium Term Lending Facility [which the Bank will increase in 2023 to ZWL$20bn from the current limit of ZWL$10bn under which micro, small and medium enterprises, individuals and the productive sectors of the economy can borrow at interest rates applicable from time to time.
Governor Mangudya said the MPC also noted the progressive decline in monthly inflation, from a peak of 30.7% in June 2022 to 1.8% in November 2022, which has seen annual inflation fall from 285% in August 2022 to 255% in November 2022.
Mangudya’s Committee expects that the economy will grow by 4% in 2023 and that inflation will remain stable at below 3% per month throughout the year.
Zimbabwe Forex and Inflation Rates according to the RBZ Governor maintains bank policy rate, to review in Q1.
Reserve Bank of Zimbabwe Governor Dr Mangudya hence maintains the bank policy rate at 200% due to the positive impact of the recent policy measures but will review the rates in the first quarter of next year, the central bank chief said.
Mangudya made it pot and clara in his statement that the bank’s Monetary Policy Committee (MPC), which met last week, was “pleased with the improved business confidence owing to the prevailing stability in the economy” and unanimously agreed to stay the course of a tight monetary policy until Q12023.
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