Rwanda’s central bank raised its policy rate to 8.75% from 8.25% on Thursday, stepping up efforts to contain rising inflation driven partly by the fallout from the conflict in the Middle East.
Central bank Governor Soraya Hakuziyaremye said the increase was aimed at anchoring inflation expectations, limiting second-round effects and helping bring inflation back within the bank’s target range of 2% to 8% in the second half of 2027.
Headline inflation rose to 14.5% year-on-year in July from 13.6% in June, according to data from the national statistics office.
The latest increase follows rate hikes in February and May as the central bank sought to curb price pressures.
Hakuziyaremye said the bank now expected average inflation of 13.1% in 2026, slightly lower than its previous forecast of 13.9%, before easing to about 7.9% in 2027.
The governor also said the central bank had begun purchasing gold as part of its foreign exchange reserves, with the precious metal now accounting for between 10% and 15% of total reserves.
Rwanda‘s economy expanded by 10% in the first quarter of 2026, compared with 6.5% in the same period a year earlier, Hakuziyaremye said, adding that economic activity remained resilient, supported by strong performance in the services and industrial sectors.
