RBZ’s MPC maintains tight policy stance

The Reserve Bank of Zimbabwe’s Monetary Policy Committee has maintained a tight policy stance, amidst a stabilizing economy.

The committee met recently to assess performance of the Monetary Policy Statement from 5 April 2024 and discuss recent economic developments.

In a statement, RBZ governor John Mushayavanhu (pictured) noted the challenges and achievements registered.

Achievements:
?Stabilized exchange rate and domestic prices.
?Despite El Nino-induced drought, economy expected to grow by 2% in 2024.
?May 2024 saw a month-on-month ZiG inflation rate of -2.4%.
?June 2024 inflation projected at around 0%.
?Projected end-of-year inflation below 5%.

Policy Resolutions:
?Maintain Bank Policy rate at 20% per annum with an interest rate corridor of 11% to 25%.

?Statutory reserve requirements for demand deposits, and savings and time deposits in ZiG to remain at 15% and 5%, respectively.

?Foreign currency statutory reserve requirements for demand deposits, and savings and time deposits to remain at 20% and 5%, respectively.

Future Commitment: Address emerging risks, ensure money supply growth aligns with 5% inflation target, and back reserve money with gold, other precious minerals, and foreign currency reserves to support economic activity and currency stability.