- Decision
- Lower
- Rate change
- 100 bps
- monetary policy rate
- 16%
The Monetary Policy Committee of the Central Bank of The Gambia cut the Monetary Policy Rate by 100 bp to 16 percent at its 4 December 2025 decision, citing continued disinflation and resilient activity that warrants support for credit and investment. After keeping the rate at 17 percent at its meetings in February, June and September 2025, this marks the first easing in at least a year. The required-reserve ratio stays at 13 percent, while the standing deposit facility rate rises to 5 percent and the standing lending facility rate falls to 17 percent (MPR + 1 pp), with the central bank promising more active open-market operations and close policy coordination with fiscal authorities. Headline inflation eased to 7.0 percent in October from 7.4 percent in September and has been in single digits for eight consecutive months, while core inflation slid to 4.5 percent; the MPC expects further moderation toward its medium-term target. Real GDP rose 5.6 percent in 2024 and is projected to expand by 6.4 percent in 2025, supported by robust private and public investment, tourism and remittances; broad money growth accelerated to 16.4 percent and private-sector credit grew 9.4 percent in September. Externally, the current-account deficit narrowed to 2.8 percent of GDP in the first nine months of 2025, reserves stood at USD 493 m (4.4 months of imports) and the dalasi remained broadly stable. The MPC noted softening global growth, moderating world inflation and subdued commodity prices, which are easing imported price pressures. It signalled readiness to adjust policy if conditions change and will review the stance at its next meeting slated for 25–26 February 2026.
Rate evolution
Over the period, the Central Bank of The Gambia lowered the Monetary Policy Rate by 300 basis points from 17 percent to 14 percent, moving from an extended hold to two cuts and then two consecutive holds. The initial 17 percent stance reflected easing but still above-target inflation, persistent core pressures, solid domestic growth, and high uncertainty from trade fragmentation, commodity volatility, climate-related shocks and geopolitical tensions, with risks to inflation judged tilted to the upside. As headline, food and core inflation moderated and imported inflation pressures eased on subdued global commodity prices, while the dalasi stayed broadly stable and reserves, remittances and tourism inflows improved, the MPC cut in December 2025 and again in February 2026 to support lending, investment and growth while keeping price stability and inflation expectations anchored.
The Committee held the policy rate at 14 percent in May 2026 after Middle East-related energy and transport shocks lifted headline, food, non-food and core inflation, the growth forecast was revised down, and geopolitical spillovers and election-related uncertainty clouded the outlook. It maintained the rate in August as headline and underlying inflation moderated but remained elevated, non-food inflation rose on persistent transport costs, domestic growth strengthened and external uncertainty persisted, leaving inflation risks tilted to the upside and warranting a cautious stance.