Zimbabwe on right track says new Monetary Policy Committee

Zimbabwe is on the right track as its monetary policy has seen inflation drop from 837.5% in July last year to 240% this month with month-on-month inflation declining from 35.53% to 2.26%.

This was said by the country’s new Monetary Policy Committee which was appointed last month at its inaugural meeting on Friday.

It affirmed its commitment to implementation of sound monetary policies in order to sustain the current disinflation trajectory and ensuring a conducive macroeconomic environment for investment and growth.

The committee made the following resolutions to buttress measures announced in the February 2021 Monetary Policy Statement and to sustain the current macroeconomic stability:

1. Maintaining the current conservative monetary targeting framework, anchored on 22.5% reserve money quarterly targets;
2. Keeping the Bank policy rate and the Medium-term Bank Accommodation (MBA) Facility rate at 40% and 30%, respectively;
3. Increasing the amount of the MBA Facility by an additional ZW$2.5 billion to cater for the winter wheat planting programme; and
4. Putting a cap on the interest rate at which banks can on-lend the proceeds from the MBA Facility at 10% above the borrowing rate to ensure recovery of the productive sectors.

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