Expansionary monetary policy to spur economic recovery

Since December, the central bank has cut interest rates by 450 basis points, much to the relief of household and business borrowers, as inflation has receded from 15 percent to six percent largely due to falling oil prices.

The BoB has said that given the circumstances, the prevailing monetary policy stance that is characterised by a monetary easing bias remains appropriate in the short term and supports a recovery of economic activity, including maintenance of robust performance of the non-mining sectors. "The projected decrease in inflation provides scope for maintenance of expansionary monetary policy to support domestic economic recovery, particularly in an environment in which fiscal stimulus is constrained by the fall in government revenues.