Lesotho Central Bank raises interest rates by 25 basis points

Reading Time: 2 minutes

The Central Bank of Lesotho in its 99th Monetary Policy Committee has resolved to revise downwards the Current Net international Reserve Target Flow of 650 million to 640 million US Dollars.

This deems it sufficient to maintain a 1:1 exchange peg of the rand to Lesotho pula.

The Central Bank says it has noted the adverse impact of the South African energy crisis to Lesotho’s economy and reached a decision to moderately raise its rate by 25 basis points from 7 to 7.25% per annum as a means to counter the inflation rate.

The Central Bank of Lesotho says based on several factors including severe energy crisis in neighbouring South Africa, there has been good economic recovery prospects which led it to revise its International Reserve Target Flow and inflation rate accordingly.

Dr. Maluke Letete, governor of the central bank of Lesotho, says at this level, the net…to 7.25% per annum.”

Maluke says the bank is also cognisant of appreciation and accordingly placing adequate regulation measures in place to the new private innovations in the digital economy space, so as to keep up with the ever-changing times.

“It is very important for us to understand, we might have regulation by the end of the year.”

The Monetary Policy Committee says while the domestic economy is expected to deteriorate further amid weaker global growth prospects, the government’s approach to a leaner cabinet size and significantly cutting the government transport fleet has for the first time in a while led to a 4% surplus in government coffers.