The Bank of Central African States published its September monetary policy report and maintained its monetary policy settings for the fourth quarter of 2026. The policy rate remains at 4.50%, the marginal lending facility rate at 5.75% and the deposit facility rate at 0.00%. Reserve requirements stay at 6.50% for demand liabilities and 4.00% for term liabilities. The decision balances weak growth against emerging price risks and the delayed effect of the previous rate cut. Regional growth is forecast to slow to 3.0% in 2026 from 3.7% in 2025, while average inflation is projected at 2.2%, below the 3% regional ceiling. However, year-over-year inflation was forecast to rise to 3.5% in September as higher energy, freight and food costs linked to geopolitical tensions feed through to prices. The bank estimates that the earlier easing may take about eight quarters to affect the real economy. External buffers have strengthened. Foreign exchange reserves are projected to reach XAF 7,604.6 billion at the end of 2026, equivalent to 4.53 months of imports, while the external currency coverage ratio is forecast at 72.4%. These indicators support policy flexibility, but the bank opted for caution given risks from intensifying conflicts and constraints on global trade.
Bank of Central African States holds policy rate at 4.50% as inflation remains below regional ceiling
The Bank of Central African States kept its policy rate at 4.50% and left its lending, deposit and reserve requirement settings unchanged for the fourth quarter of 2026. Average inflation is forecast at 2.2% in 2026, while growth is expected to slow to 3.0%. Stronger foreign exchange buffers supported the outlook, but external price risks and the delayed impact of the previous rate cut favored caution.