The Bank of Cape Verde published its 2025 State of the Economy Report, finding that real gross domestic product growth slowed to 6.3 percent from 7 percent in 2024 as household consumption and external tourism demand moderated. Average inflation rose to 2.3 percent from 1 percent, reflecting higher import prices and stronger domestic demand, but remained consistent with price stability. The current account recorded a surplus of 3.7 percent of GDP, supported by tourism receipts, remittances and other private transfers. Net international reserves reached EUR 1.06 billion, covering 8.8 months of imports, up from 6.5 months in 2024. The central bank maintained a restrictive monetary policy stance, adjusting reference rates three times to narrow the differential with euro-area rates and support the fixed exchange rate regime. The policy rate ended 2025 at 2.5 percent, with domestic rates becoming more favorable than euro-area rates from April. Credit growth slowed, while the banking sector’s solvency ratio rose to 24.8 percent and nonperforming loans fell to 5.1 percent of total credit. Public finances moved to a surplus of 1.1 percent of GDP, and central government debt declined to 101.1 percent of GDP, although the report continued to identify elevated public debt and the net international investment deficit as vulnerabilities.
Bank of Cape Verde2026-07-28
Bank of Cape Verde reports slower 6.3 percent growth as reserves rise to 8.8 months of imports
The Bank of Cape Verde reported that economic growth slowed to 6.3 percent in 2025, while average inflation rose to 2.3 percent. A 3.7 percent current account surplus helped lift reserves to EUR 1.06 billion, covering 8.8 months of imports. The central bank maintained a restrictive stance, and the banking sector’s solvency ratio increased to 24.8 percent.