Rwanda: Sixth Review Under the Policy Coordination Instrument and Monetary Policy Consultation Clause-Press Release; Staff Report; and Statement by the Executive Director for Rwanda

June 29, 2022

Preview Citation

Format: Chicago

Rwanda: Sixth Review Under the Policy Coordination Instrument and Monetary Policy Consultation Clause-Press Release; Staff Report; and Statement by the Executive Director for Rwanda, (USA: International Monetary Fund, 2022) accessed September 20, 2024

Summary

This paper analyses Rwanda’s Sixth Review under the Policy Coordination Instrument (PCI) and Monetary Policy Consultation Clause. Rwanda continues to implement its Economic Recovery Plan while confronting the lingering effects of the pandemic and the spillovers from the war in Ukraine. Headline inflation has been on the rise since the beginning of the year. Rising inflationary pressures, exacerbated by rising commodity prices, are compounding the policy challenges of balancing economic recovery with maintaining price stability. In view of rising inflation, the National Bank of Rwanda should stand ready to tighten monetary policy more aggressively to anchor inflation expectations. Implementation of the interest-rate-based monetary policy framework should continue with greater exchange rate flexibility to ensure external sustainability. Policies under the PCI continue supporting the recovery from the pandemic, the response to mitigate the headwinds from the war in Ukraine while maintaining macroeconomic stability, and the implement the medium-term fiscal consolidation strategy to preserve debt sustainability. The PCI also supports reform efforts, such as financial inclusion, digitization, and green public financial management (PFM) to deliver a more inclusive and sustainable growth.

Subject: Financial institutions, Health, International organization, Monetary policy, Prices, Public debt, Public financial management (PFM)

Keywords: Consultation benchmark, COVID-19, Fiscal risks, Global, Headline inflation, Inflation, Inflation development, Inflation expectation, Interest-rate-based monetary policy framework, Loans, Management practice

Publication Details

Pages:

73
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2022/200
Stock No:

1RWAEA2022002
ISBN:

9798400212864
ISSN:

1934-7685

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