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Economic Update

MPC retains benchmark rate at 7.5%

The Monetary Policy Committee (MPC) met on 27th July and noted that its action of tightening the monetary policy in May 2022 was timely in anticipating emerging inflationary pressures, and its impact was still transmitting through the economy. This action was subsequently complemented by an additional package of fiscal measures by the government to moderate the prices of specific items such as fuel and maize flour. Additionally, the Committee noted that international commodity prices – particularly oil, wheat and edible oils – had begun to moderate. These developments were expected to ease domestic inflationary pressures in the near term and thus the MPC decided to maintain the Central Bank Rate (CBR) at 7.50%.

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