By Chisomo Phiri
The Monetary Policy Committee (MPC) of the Reserve Bank of Malawi(RBM) says it has decided to keep the Policy Rate at 26 percent.
The policy rate is a short-term reference rate set by a central bank.
In a statement released on Friday, RBM Governor Wilson Banda says the decision was made during MPC meeting on November 4,2024.
Banda also reveals that the Committee has chosen to maintain the Lombard rate at 20 basis points above the policy rate and the Liquidity Reserve Requirement (LRR) ratio at 3.75 percent for foreign currency deposits.
He has however, said the Committee has decided to increase the LRR ratio for domestic currency deposits by 125 basis points to 10 percent.
According to Banda, the Committee believes that inflation will slow down in the fourth quarter of 2024 due to favourable base effects.
Says Banda:”Despite this, money supply continues to grow rapidly, posing risks to the inflation outlook.
“To address this, the MPC has decided to tighten the LRR ratio for domestic deposits, which will slow down money supply growth pressures and enhance the inflation deceleration process in the short to medium term.”
 of the Reserve Bank of Malawi(RBM) says it has decided to keep the Policy Rate at 26 percent. The policy rate is…){kind=link}