The Reserve Bank of Zimbabwe has kept the Bank Policy Rate at 35%, despite a gradual decline in inflation over the past few months.
The Bank Policy Rate is the interest rate set by a country’s central bank for lending to commercial banks. It is the main tool used to control inflation and manage economic activity.
In his 2026 Monetary Policy Statement on 27 February, RBZ Governor John Mushayavanhu said the central bank is taking a cautious approach to avoid easing monetary policy too soon, which could risk reversing recent gains in controlling inflation.
He added that the Monetary Policy Committee (MPC) will review the Bank Policy Rate based on inflation trends and the performance of other monetary, financial, and macroeconomic indicators. Said Mushayavanhu:
“The tight monetary policy stance adopted by the Reserve Bank since September 2024 has engendered a progressive disinflation trajectory and delivered a single-digit inflation starting in January 2026.
“As such, the achievement of single-digit ZiG annual inflation provides scope for the eventual review of the Bank Policy Rate.
“It is, however, critical that the Reserve Bank remains cautious to avoid the premature easing of monetary policy and risk reversing the gains on the inflation front.
“Any renewed inflation pressures have the potential to induce policy reversals, including necessitating an even more aggressive tightening, with higher economic and social costs.
“In order to strike a balance between price stability and economic growth, the Reserve Bank will follow a gradual and cautious, stepwise policy adjustment path.
“Importantly, the adjustment path will be data-dependent as opposed to date-dependent. The cautious approach recognises that the economy is in the early stages of a low and delicate inflation environment, achieved after prolonged periods of high inflation and currency instability, stretching over three decades.”
The RBZ has also kept the current minimum interest rates for savings and time deposits unchanged in both ZiG and USD. For ZiG deposits, the savings rate remains at 5% and the time deposit rate at 7.5%. For USD deposits, the savings rate is 2.5% and the time deposit rate 4%.
The central bank has also maintained statutory reserve ratios of 15% for savings and fixed deposits, and 30% for demand deposits, for both local and foreign-currency accounts. Said Mushayavanhu:
“The differentiated statutory reserve ratios are designed to incentivise banks to promote savings and time deposits which attract a lower reserve ratio of 15%.
“Banks are, therefore, encouraged to take advantage of the differentiated statutory reserve ratios to promote savings deposits and mobilise affordable long-term investible funds to support the economy’s productive sectors.”
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