The Monetary Policy Committee of Banky Foiben’i Madagasikara (BFM) kept the policy rate at 12.00 % at its 3 February 2026 meeting, judging the current stance appropriate to steer inflation towards the 5 % medium-term target while safeguarding macroeconomic stability amid still-fragile disinflation and excess liquidity. After a 150 bp tightening to 12.00 % in May 2025 the rate has been left unchanged. BFM noted that year-on-year inflation slowed to 7.2 % in December 2025 from the January peak of 9.5 %, and is forecast to continue easing in 2026 on softer global commodity prices and contained money supply growth, which stood at 11.0 % y/y in December within the 8–16 % guideline band; GDP growth is estimated at 3.4 % for 2025, with survey data pointing to a modest first-quarter 2026 and a gradual rebound from the second quarter. The ariary lost 8.8 % against the euro but gained 2.5 % versus the USD in 2025, then strengthened against both currencies in January 2026, while official reserves rose to USD 3.6 bn, covering nearly seven months of imports. Globally, growth held at 3.3 % in 2025 and disinflation progressed unevenly, prompting major central banks to retain a cautious stance. BFM signalled that any policy recalibration will be gradual and data-dependent, warning that premature easing could rekindle price pressures and urging banks to deploy their excess liquidity to support credit to the economy.
Central Bank of Madagascar 2026-02-03
BFM keeps policy rate unchanged at 12.00 %
Banky Foiben’i Madagasikara kept its policy rate at 12.00 % on 3 February 2026, judging the stance adequate to guide inflation—now 7.2 % y/y—toward the 5 % medium-term target while preserving macro-stability amid excess liquidity. The central bank signalled any future moves will be gradual and data-dependent.