The Reserve Bank of Zimbabwe has kept the Bank Policy Rate at 35%, despite a gradual decline in inflation over the past few months.<\/p>\n
The Bank Policy Rate is the interest rate set by a country\u2019s central bank for lending to commercial banks. It is the main tool used to control inflation and manage economic activity.<\/p>\n
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.<\/p>\n
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:<\/p>\n
\u201cThe 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.<\/p>\n
\u201cAs such, the achievement of single-digit ZiG annual inflation provides scope for the eventual review of the Bank Policy Rate.<\/p>\n
\u201cIt 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.<\/p>\n
\u201cAny renewed inflation pressures have the potential to induce policy reversals, including necessitating an even more aggressive tightening, with higher economic and social costs.<\/p>\n
\u201cIn order to strike a balance between price stability and economic growth, the Reserve Bank will follow a gradual and cautious, stepwise policy adjustment path.<\/p>\n
\u201cImportantly, 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.\u201d<\/p>\n
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%.<\/p>\n
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:<\/p>\n
\u201cThe differentiated statutory reserve ratios are designed to incentivise banks to promote savings and time deposits which attract a lower reserve ratio of 15%.<\/p>\n
\u201cBanks 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\u2019s productive sectors.\u201d<\/p>\n
Related:<\/b><\/p>\n
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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\u2019s central bank for lending to commercial banks. It is the main tool used to control inflation and manage economic […]<\/p>\n","protected":false},"author":84,"featured_media":115605,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,6],"tags":[],"class_list":["post-115606","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy"],"yoast_head":"\n