BCEAO: A stable monetary policy to maintain the balance between inflation and growth in the WAEMU.
The Monetary Policy Committee (MPC) of the BCEAO, meeting on December 4, 2024, decided to maintain its current monetary policy, favoring a cautious stance in light of the economic and geopolitical uncertainties affecting the UEMOA. The key interest rate remains set at 3.50%, and the marginal lending rate remains stable at 5.50%, unchanged since December 2023. This orientation reflects a desire to preserve a delicate balance between controlling inflation and supporting sustainable growth dynamics.
Inflation, although slightly above the target range (1% to 3%), stood at 3.4% in October and is expected to reach 3.6% for the year 2024. However, the BCEAO considers these levels manageable. That said, challenges persist, including security vulnerabilities in certain regions, adverse climatic conditions affecting agriculture, and geopolitical tensions exerting pressure on the prices of energy and food commodities.
Despite this context, the Union's economy continues to demonstrate resilience. Growth is expected to be 6% in 2024, driven by a 5.9% annual increase in credit to the economy by the end of September, and by favorable terms of trade supported by advantageous exports. These positive indicators reflect the strength of the region's economic fundamentals. However, the MPC emphasizes the importance of strengthening medium-term economic viability, particularly through the consolidation of the current account and increased mobilization of external resources.
By keeping its monetary instruments unchanged, the BCEAO reaffirms its ambition to balance price stability with support for a robust economic recovery. This strategy, adjusted to global uncertainties, is part of a clear vision to consolidate the foundations of sustainable growth while ensuring the macroeconomic resilience of the UEMOA.
Source: Sika finance, Editorial Team MEPD Web Portal