Bank of Mauritius raises key interest rate to 5%
By the AFREEQUE newsroom, based on Defimedia and Business Day (South Africa)
The Bank of Mauritius raised its key interest rate by 25 basis points, from 4.75% to 5%, at a meeting of its Monetary Policy Committee on 11 November. The increase aims to contain inflation, which reached 6.4% in October, above the target range of 2% to 5%, according to Defimedia.
The decision was taken unanimously, with the committee believing that swift action would prevent inflation from remaining persistently above its target. The Bank of Mauritius said that a delayed adjustment would have had a greater impact on the purchasing power of households and businesses.
Inflation is expected to reach 4.7% in December 2026 before rising to 5.5% in December 2027. The Bank of Mauritius also highlighted risks linked to energy and commodity prices, as well as a possible drought that could reduce agricultural production and fuel food inflation.
The previous rate increase was in May, when rates were raised by 25 basis points. Despite monetary tightening, the central bank forecasts growth of 3% in 2026 and 3.2% in 2027, believing that higher interest rates can contain price pressures without undermining this momentum.
