Economics Association of Malawi (ECAMA) says the slashing of policy rate by the Reserve Bank of Malawi (RBM) from October 2016 to December 2017 will help to boost the country’s economy in 2018.
This was said when ECAMA was giving an analysis of how the country has performed economically in terms of monetary policy.
The Executive Director for ECAMA, Maleka Thula said RBM revised its policy rate four times from 27 percent in 2016 to 16 percent in 2017.
“We saw that when we started the year interest rate was really high and the Reserve bank of Malawi revised the policy rate,’’ he explained.
He added that commercial banks have also been revising their interest rate whereby in October 2016 we had 37.3 percent and as of now it is around 25 percent.
Thula said with the decline, the cost of borrowing by individuals as well as private sector will decrease.
He said this will instead make a lot of people to borrow money from the commercial banks thereby boosting the Malawi’s economy.