The Bank of Zambia’s Monetary Policy Committee has raised the Policy rate by 25 basis points to 9.25% for November 2012.
Head of Public Relations Kanguya Mayondi in a statement released to the media yesterday said the committee at its October 2012 meeting noted upward risks to overall inflation for month of November.
Mr Mayondi says these include the excess liquidity in the market, which may exert upward pressure on inflation going forward and the rising stock feed prices that may contribute to higher meat prices.
He says the global grain deficit that may induce higher domestic and imported grain prices is also another risk factor.
He however, says the Committee noted downward risks to inflation, which may arise from mainly the stability in the prices of vegetables and fish, reflecting an improvement in seasonal supply.
Mr Mayondi explains that the Committee weighed the risks and was of the opinion that inflationary pressures during the policy-relevant period may pose a threat to the end-year inflation target of 7.0%.
He says to curb inflationary pressures, the Committee therefore, decided to raise the Policy Rate to 9.25% from 9.0%.
We Zambians must be comitted to sustain our positive strides that our PF Govt has done just like the United States government has expressed optimism that Zambia is economically well placed and stands more advantaged to grow to about 7 percent due to its prudent macroeconomic management policies it has put in place.
United States Ambassador to Zambia Mark Storella believes Zambia is on the right track in…its quest to ensure the economy remains stable and conducive for conducting business.
Speaking in an exclusive interview with ZANIS, Mr. Storella stressed that Zambia will certainly grow because the Zambian government has proved through its determination to achieve its set goal of 8 percent growth.
The PF is neither a sound nor prudent economic manager.The almost $3bn left by MMD in reserves has been whittled down,they don’t have coherent plans for bond proceeds,they’ve unprocedurally retaken zamtel/RSZ thereby scaring investors and politics is always the overriding factor in these decisions just to put a muddy face on the stellar MMD economic record.
Put it like,’Scaring away thieves not investors.’
So what? Anyone who thinks banks actually charge their borrowers only 9% (or even 9.25%!) is sadly deluded. PF seems to think it can hoodwink people into believing that borrowing is now affordable by quoting these base rates while it has done nothing tangible to improve real people’s access to credit.
Spot on lad, i recently accessed a loan, the loan interest was 24%….
@ Fool me once – you need to know somwthing to talk about it. Do some reading before you comment. The hinderance to reduction of cost of borrowing is mainly behaviour – most of us don’t repay loans. Corporates with sounds boards and also individuals of non zambian origin do access cheap credit here in Zambia because of their culture – honest and precise. The policy rate is just a transparent way of managing the monetary side of the economy. It serves as a succesor to the Base Lending rates of banks and also as a new monetary policy mechanism. READ A BIT BEFORE YOU COMMENT ON TECHNICAL ISSUES.
I think the reason interests shoot to over 20% is because most don’t payback on time.
If the base rates where so high do you think so many people would be rushing to get loans for cars, houses e.t.c.
The banks know that most people won’t pay back in time and put low base rate knowing that as time goes by people wont pay back hence increasing the ratesÂ