BOZ Increases Lending Rate To Keep Inflation Low

The Bank of Zambia has increased its Policy Rate to 12.5 from 12 percent last month.

The policy rate is used as a yard stick on which commercial banks can peg their lending rates.

The central bank says adjustment aims at consolidating lower inflation in 2015 following inflationary pressures experienced in the third quarter of 2014.

Bank of Zambia Governor, MICHAEL GONDWE says the Central Bank therefore projects inflation to remain around 7.9 percent higher than the target of seven percent owing to deterioration in the external sectors.

And Dr Gondwe says the economy has been adversely affected by a decline in copper prices and global financial flows.

He has also noted that the International Monetary Fund downgraded growth forecasts for 2014 from 3.7 to 3.3 percent with growth in 2015 set to remain subdued.

Dr Gondwe says growth in Sub Saharan Africa is expected to remain robust while global growth in developing economies and emerging markets is forecast to slow down in 2015.

Dr GONDWE was speaking at Media briefing in LUSAKA today.

Posted by Kunda on November 20, 2014. Filed under BUSINESS. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.