BoZ Maintains Policy Rate at 9.75 Percent for Fifth Time

BoZ Maintains Policy Rate at 9.75 Percent for Fifth Time

The Bank of Zambia has for a fifth time maintained the Monetary Policy rate at 9.75 percent.

Presenting the policy brief in Lusaka, Bank of Zambia Governor Denny Kalyalya has cited the continued subdued economic activity which heightened in the last quarter of 2018 as well as slow progress towards fiscal consolidation as reflected in the rising domestic arrears and public debt and external debt service payments.

Dr Kalyalya says the decision to maintain the Monetary policy rate is also attributed to the projected rise in inflation which is likely to be between six and eight percent.

He however, states that the Central bank stands ready to respond in the event the inflation rate rises to above the projected rate by adjusting the policy rate.

Meanwhile Dr Kalyalya has disclosed that demand for government securities picked up from K5.3 billion to K5.8 billion in the previous quarter.

He has stated that non residential holding of securities dropped from K8.5 billion in the previous quarter to K8 billion.

And Dr Kalyalya says the central bank is concerned with the continued reduction in liquidity reserves.

He says this is why there is urgent need for government debt to be serviced as quickly as possible as some of the resources are being utilized in servicing these debts.