RBZ maintains bank rate at 35%, bank deposits at 15%

Key Resolutions from the Monetary Policy Committee Meeting – December 3, 2024.

The Monetary Policy Committee (MPC) of the Reserve Bank of Zimbabwe convened on December 3, 2024, to review the macroeconomic and financial outlook and implement measures to ensure inflation expectations remain well-anchored.

Key Resolutions:
1⃣Bank Policy Rate:
The MPC resolved to maintain the Bank Policy rate at 35%.

2⃣Statutory Reserve Requirements:
-Savings and time deposits for both local and foreign currencies will remain at 15%.

-Demand and call deposits for both local and foreign currencies will remain at 30%.

3⃣Foreign Exchange Market Efficiency:
-The Committee reiterated its commitment to deepening price discovery mechanisms in the interbank foreign exchange market.

-The recently gazetted legislation on the payment of QPDs for corporate tax in a 50/50 US$: ZiG arrangement is expected to bolster foreign currency availability in the market.

4⃣Targeted Finance Facility (TFF):
To mitigate the impact of tight liquidity conditions on economic growth, a Targeted Finance Facility will be introduced to support the productive sector. Operational details will be shared with banks in due course.

The MPC highlighted that these measures have successfully stabilized inflation and exchange rates since October 2024.

Month-on-month inflation decelerated significantly from 37.2% in October to 11.7% in November 2024.

This progress aligns with increased foreign currency inflows, totaling US$11.05 billion during the first 10 months of 2024, up from US$9.27 billion during the same period in 2023.

Zwnews