Rwanda holds policy rate, sees inflation falling towards band

KIGALI (Reuters) -Rwanda’s central bank maintained its key lending rate at 7.5% on Thursday and said it saw inflation falling towards its target range by the end of the year.

Annual inflation peaked at 21.7% in November last year, falling to 11.2% last month, but it is still above the country’s 2%-8% target.

Central bank governor John Rwangombwa told a press conference that policy was “tight enough to bring inflation back to our band”.

“In 2024 (inflation) will be around 6%, but also we intend to maintain (the rate) for next year assuming nothing else, nothing unusual happens” to change the trajectory of inflation, he said.

Geopolitical tensions that could push up the price of global commodities and the success of weather-dependent agricultural production pose risks to the inflation outlook, he added.

The central bank estimates that economic growth slowed slightly in the third quarter, but that the country is on track for growth of around 6.2% for 2023 as a whole.

(Writing by Hereward Holland; Editing by Alexander Winning and Alex Richardson)