The Monetary Policy Committee met today the 31st May 2012 to review recent economic developments and assess the upside and downside risks to the end-year inflation target of 7.0%.
The Committee observed that global economic growth continues to be weak, underpinned by the continued sovereign debt crisis affecting the Euro zone economies. Nonetheless, Zambia’s international trade performance is expected to remain favourable in June 2012, mainly due to an expected increase in merchandise export volumes. In addition, the continued favourable macroeconomic environment and the seasonal improvement in food supply will all have a moderating effect on inflation.
In the money market, liquidity conditions are not expected to pose a threat to inflation in the month of June 2012. Further, the improved supply of maize, fish and fresh vegetables on account of seasonal factors and the expected reduction in meat prices following the ban of maize and wheat bran exports will have a dampening effect on food inflation.
Overall, the above developments are expected to mitigate the lagged pass-through effects of the depreciation of the Kwacha experienced in recent months. Given the foregoing, the Committee has weighted the risks to inflation and has determined that inflation during the policy-relevant period would remain largely consistent with the end-year target of 7.0%. Accordingly, the Committee has decided to maintain the Bank of Zambia Policy Rate at 9.0% in June 2012.
The next meeting of the Monetary Policy Committee to review the Bank of Zambia Policy Rate will be held at the end of June 2012
Chwe Chwe Chew Chwe!!!!! Sorry Pabwatoooooo!!!! No I meant Fooowaaaard!!!!!!! Lol! Ok thats good for our economy. Hope we can sustain this rate for sometime.
Please boz be serious. Let us have the rate set every quarter ie after every 3 months. Why the short termism. You are jokers!
The rates are likely to remain the same for many months if not years. Ask the UK. Bank of England base rates have been at 0.5% for nearly 2 years now. of course every month they meet to duscuss the same old same old and conclude the rate should remain at 0.5%.
Expect similar things in Zambia. Lucky people, those ones getting sitting allowances for saying the same thing month after month.
The problem we have in the country is that such policy issues are not taken seriously,this by itself would mean banks to reduce the lending rates but that has not happened.All the banks are saying that the cost of doing business in zambia is high plus the risks involved in lending money.
So the 9% does not mean anything because it has no effect.
@Hendrix, Yes indeed, these business indexes are wack when no one acts upon them. Getting credit in Zambia remains vastly at odds with the BoZ base rate despite its stability..
ITS ONLY STANBIC BANK WHICH ANNOUNCED THT EFFECT FROM 15-04.12 THEIR LENDING RATE WOULD BE AT 11% WHICH IS A GOOD THING.SO GENTLEMEN IF UR LOOKING FOR A LOAN JUST GO TO STANBIC ATLEAST FOR THE MOMENT
all the news today is just junk, damn difficulty shhiit.
@ Mwinelubemba thankyou for sharing that information, 11% is much much better than the average of 20% which most banks in Zambia are offering.People lets reduce DEMAND for the loans by not getting from expensive Banks and I can asure you they will be forced to reduce to resoanable and affordable rates.In Zambia today when you get a loan from our Banks,you become a slave which should not be the case.
Market forces will force banks to start leanding towards the 9% threshhold. Just wait and see. When borrowers rush to Stanbic, other banks will be forced to lower the rates.
I watched a documentary 97% Owned on http://topdocumentarystream.com/97-owned/. I would say that this is first documentary highlighting this issue.Â