- Decision
- Maintain
- Rate change
- 0 bps
- monetary policy rate
- 14%
The Monetary Policy Committee of the Central Bank of The Gambia held the Monetary Policy Rate (MPR) at 14%, citing stronger domestic activity and moderating headline inflation alongside elevated underlying and non-food price pressures and persistent external uncertainty. Over the past year, the MPC held the MPR at 17% in September 2025, cut it by 100 basis points to 16% in December and by 200 basis points to 14% in February 2026, then held it in May. The MPC maintained the required reserve ratio at 13%, the standing deposit facility rate at 5% and the standing lending facility rate at 15%. Headline inflation eased to 7.0% in July but remained above the central bank’s implicit 5.0% target, while real GDP growth is projected at 5.8% in 2026 and the banking sector remained stable with adequate capital and liquidity buffers. The current account deficit widened in the second quarter, although the dalasi remained broadly stable and gross official reserves stood at USD 563.9 million at end-July, covering 4.3 months of prospective imports. Globally, geopolitical tensions, supply disruptions and elevated energy and food prices have stalled disinflation and created upside risks for commodity-importing economies. The MPC remains committed to returning inflation to target over the medium term and stands ready to act if conditions warrant.
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.