The Central Bank of Eswatini published its Recent Economic Developments update covering December 2025 and January 2026, reporting a further easing in inflation, faster year-on-year GDP growth in the third quarter of 2025, unchanged key lending rates and an appreciation of the lilangeni/rand. The report also points to a December contraction in broad money linked to lower net foreign assets, alongside continued expansion in private sector credit and a further drawdown in official reserves. Headline consumer price inflation slowed to 2.3% in December 2025 (core inflation 2.8%), while real GDP growth accelerated to 5.8% year-on-year (seasonally adjusted) in Q3 2025, driven by a rebound in the primary sector (including mining and quarrying growth of 65.3%) and stronger secondary and tertiary activity (manufacturing 10.0%, construction 13.0%, information and communication 30.6%). The discount rate was maintained at 6.75% and the prime lending rate at 10.25% in January 2026; the lilangeni averaged SZL 16.28 per USD in January (a 3.5% month-on-month appreciation) and closed the month at SZL 15.92 per USD. Net foreign assets fell 30.0% month-on-month to SZL 10.5 billion in December, and gross official reserves declined to SZL 11.2 billion at end-January, reducing import cover to 2.6 months. Private sector credit rose to SZL 22.4 billion in December (+2.1% month-on-month; +9.8% year-on-year) and the banking sector non-performing loan ratio decreased to 6.7%, while broad money (M2) fell 4.9% month-on-month to SZL 29.2 billion. Total public debt was estimated at SZL 38.1 billion (39.7% of GDP) at end-January, and the trade surplus narrowed to SZL 80.8 million in January as exports fell 16.2% month-on-month to SZL 3.0 billion.

Original source View in tracker