Africa-Press – Malawi. Malawians may finally breathe a sigh of relief as inflation begins to ease, according to the latest announcement from the Monetary Policy Committee (MPC) of the Reserve Bank of Malawi (RBM).
In a statement signed by MPC Chairperson and RBM Governor Dr. Mafuta Mwale, the committee noted that inflation—which had been relentlessly rising—has begun to slow down. This shift offers hope for a potential drop in the prices of essential goods like maize flour, sugar, cooking oil, bread, and soap.
However, whether this relief will actually reach consumers remains questionable. In Malawi, many traders are known for ignoring policy shifts, prioritizing profits over public welfare.
The MPC, which met recently in Mzuzu, revealed that headline inflation rose slightly to 29.9% in Q1 2025, up from 29.2% in Q4 2024, primarily driven by rising food inflation, which jumped to 37.6% from 36.5%. On a brighter note, non-food inflation eased slightly, dropping from 18.4% to 18.1%.
More encouraging is the trend in monthly inflation, which fell from 30.7% in February to 30.5% in March 2025. Looking ahead, the Committee projects inflation could fall to around 27% by the end of 2025, down from 32.2% in 2024.
In its latest decision, the MPC maintained the policy rate at 26%, with the Lombard Rate—the interest charged to commercial banks borrowing from the RBM—set at 20 basis points above the policy rate. This suggests banks have no justification to raise lending rates, as the RBM has kept borrowing costs stable.
But the real question remains: Will banks play fair?
Despite RBM’s efforts, many banks in Malawi—such as National Bank, FDH, and Standard Bank—are often reluctant to adjust their lending rates in response to policy shifts. Their focus appears to be more on maximizing profits than easing financial pressure on struggling citizens.
While Malawians grapple with the soaring cost of living, local banks continue to report record-breaking profits, raising serious questions about their commitment to economic justice.
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