Rwanda is considering to relax its monetary policy stance and a fiscal stimulus through 2019 to support the current growth in credit to the private sector, Central Bank governor, John Rwangombwa said on Thursday.
Rwangombwa expects the move to strengthen the improvement in domestic demand.
“This will lead to rising in inflation during the second half of the year compared to 0.7 percent recorded in the first half of the year,” he said while launching this quarter’s monetary.
According to the governor, Rwanda expects good economic performance following the composite index of the economic activities.
“They point to sustainable economic performance in the second half of the year, with the projection of 7.8 percent economic growth by end 2019,” he said.
He, however, warned that inflation is expected to slightly pick up in 2019 following a more than anticipated performance in agriculture sector with headline inflation expected at 2 percent this year from a projected 1.4 percent earlier.
Rwangombwa said the national bank will continue to monitor developments in domestic and global economic conditions and stands ready to take appropriate measures to ensure the country’s macroeconomic stability despite downward risks of intensified US-China trade wars and uncertainties around Brexit.
The national bank also indicated that the country’s exports continued to grow in the first six months this year, rising 7.5 percent to $577.8 million driven by the good performance of non-traditional exports and re-exports which offset the fall in traditional exports that resulted from weakening external demand.
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