The Bank of Zambia has maintained the same Monetary Policy Rate and Statutory Reserve Ratio again in a bid to induce lower interest rates and revive economic growth.
Speaking during a media briefing in Lusaka today, BoZ governor Dr Denny Kalyalya announced that the Central Bank decided to maintain the Monetary Policy Rate (MPR) at 9.75 per cent, while also keeping the Statutory Reserve Ratio (SRR) at 5 per cent.
The MPR is the benchmark lending rate which the Central Bank sets on commercial banks to either increase or decrease interest rates on credit facilities, while the SRR is the proportion of deposits a commercial bank, by law, must keep in cash or place with the Central Bank.
Dr Kalyalya explained that the Central Bank decided to maintain the MPR and SRR to help induce the lowering of high interest rates that have remained above 24 per cent, and to boost economic growth that remains subdued.
“We feel that rate of 9.75 per cent is appropriate. We see that there are still challenges in the credit market; credit extension to the private enterprises is a problem so we want that to pick up,” said Dr Kalyalya.