BoM raises Key Repo rate raised by 0.75%
At the meeting of Monetary Policy Committee of the Bank of Mauritius (BoM) held on 28 September 2022, it was unanimously agreed to increase the Key Repo Rate (KRR) by 75bps, bringing the new rate to 3%.
Against a global economic backdrop tainted by supply chain disruptions caused mainly by the ongoing Ukraine-Russia war and the Covid-19 situation in China, central banks around the world are tightening their monetary policy in a bid to combat inflation.
On the domestic front, economic recovery is on the cards with the revival of the tourism industry and the BoM forecasts real growth for 2022 at 7.4%. Given the difficult global economic context, inflation prediction for 2022 has been increased to 10.6%.
In view of the normalization of activities in a post-covid era and to counter inflationary pressures, the BoM is in favour of the removal of accommodative measures implemented during those exceptional times, such as the downward revisions made to the KRR during the covid period – it is however noted that the new KRR is still far from the pre-Covid rate of 3.35%.
For more information, please check out the press release made by the BoM by clicking Here.