"BoG to hike policy rate to 30.5% in May \u2013 Fitch Solutions"

" BoG to hike policy rate to 30.5% in May \u2013 Fitch Solutions \r\n\r\nMonetary Policy Rate (MPR) of the Central Bank is expected to be further hiked by 100bps to 30.5% in May 2023, says research agency, Fitch Solutions.\r\n\r\nThe anticipated hike is coming after the Central Bank adjusted its key lending rate to banks at 29.5% last week.\r\n\r\nThe BoG has now hiked by a cumulative 1,500bps since November 2021, making it one of the most hawkish central banks globally.\r\n\r\nThe monetary policy committee (MPC) of the BoG stated that \u201cit is important that the monetary policy stance be tuned further to re-anchor inflation expectations\u201d, suggesting that additional tightening is likely.\r\n\r\nAccording to the research firm, it expects that the BoG will keep the policy rate on hold at 30.5% till the end of 2023 and into 2024 as inflation comes down more substantially.\r\n\r\n\u201cTurning to 2024, we believe that the BoG will keep the policy rate on hold at 30.50%.\u00a0While inflation will moderate further \u2013 we forecast inflation will average 16.0% in 2024 \u2013 we believe that it is unlikely that the BoG will start easing monetary policy\u201d.\r\n\r\nIndeed, under an expected International Monetary Fund programme, the Central Bank will likely be encouraged to keep the policy rate elevated to \u201cstrengthen its monetary policy framework\u201d, it explained.\r\n\r\nMeanwhile, Fitch Solutions forecast inflation to average 37.6% in 2023, higher than the 31.5% recorded in 2022.\r\n\r\nFitch Solutions says that given the high average inflation rate of 37.6%, it expects that policymakers will remain focused on controlling price growth in the near term as they aim for a more substantial disinflation trajectory before concluding the tightening cycle."

"BoG to hike policy rate to 30.5% in May \u2013 Fitch Solutions"

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