Central bankers discuss monetary policy challenges

AFRICAN Central Bank Governors gathered in Kigali last week to deliberate on the challenges in the monetary policy framework following a recent spike in inflation driven by external shocks.The theme of the international conference on Monetary Policy Frameworks among developing countries that was held at Serena Hotel was ‘practice and challenges’.Participants from various Africa countries and beyond examined and shared experiences about current practice on the monetary policy frameworks, challenges and responses to different shocks by various countries especially to keep inflation low and stable.Prime Minister, Pierre Damien Habumuremyi, who opened the meeting, encouraged the experts to discuss ways through which the financial sector can promote inclusive growth.“Efficient monetary policy should aim at developing financial sector because it is still characterised by low volumes of credit,” he said.The Director of African Department at the International Monetary Fund, Antoinette Sayeh, hailed Rwanda’s policies and urged other countries to learn from the country’s stable macroeconomic environment.Last year, parts of Eastern Africa were hit by a severe food crisis as inflation shot above 10 per cent. Only Rwanda managed to contain inflation to a single digit.“The policies have made Rwanda such a great example in Sub Saharan Africa, however, the global economic outlook has not improved and the recovery is still uncertain,” she cautioned.Amb.Claver Gatete emphasised that central banks need to focus on research and work closely with government to coordinate the supply side.“Inflation also comes from agriculture, trade and fuel where government plays a key role, coordinating on the supply side has helped Rwanda to contain inflation in single digit,” Gatete said.

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Central bankers discuss monetary policy challenges