The Central Bank(CB) decided to hold its policy rates steady while reemphasizing its commitment to sustain the low-interest rate structure until the economy recovers.
The Monetary Board of the CCB, at its meeting held on Wednesday, decided to maintain the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) of the Bank at their current levels of 4.50 percent and 5.50 percent, respectively.
While noting the recent slowdown in credit disbursements to the private sector and inadequate lending to productive sectors of the economy, the CB stressed the need for the financial system to actively lend to productive sectors in order to support the ongoing recovery of domestic production-based economic activity.
Further, the Board observed the recent uptick in certain market interest rates such as true treasury bills and reemphasized its commitment to continue the low-interest rate structure until the economy shows signs of sustained revival, in the context of the low inflation environment
“The Central Bank will continue to monitor domestic and global macroeconomic and financial market developments and take further proactive measures to help the economy to reach a sustainable high growth trajectory while maintaining inflation in the targeted 4-6 percent range under the flexible inflation targeting framework,” the CB said in the monetaray policy review announcement.