THE Bank of Zambia’s Monetary Policy Committee (MPC) has decided to adjust the Monetary Policy Rate upwards by 50 basis points to 8.50%.
In a statement on February 17, Governor Christopher Mvunga said this has been necessitated by the escalation in inflationary pressures, which are pushing inflation further away from the upper bound of the 6-8% target range.
“The decision balances the need 10 contain rising inflation and anchor inflation expectations against the efforts made to support financial system stability and growth. Ensuring that inflation remains well anchored in the medium-term is essential to moderate fragilities in the financial sector and support economic recovery.
In addition, the implementation of a strong fiscal policy adjustment, whose key parameters are clearly outlined in the Government ‘s Economic Recovery Programme, is critical in restoring macroeconomic stability.” he said.