Policy Changes

The Bank of Mauritius has increased, with effect from 29 September 2000, its Lombard Rate by half per cent (50 basis points), from 11.5 per cent per annum to 12.0 per cent per annum. Changes in the Lombard Rate act as a signalling mechanism for the monetary policy stance of the Bank.

This increase was considered necessary against the background, inter alia, of the upside risks of inflationary pressures stemming from the global economic recovery, the need for Mauritius to adjust to an environment where international oil prices have risen substantially in recent months, ongoing expectations of interest rate hikes in international financial markets and also having regard to the pressures on the foreign exchange market, particularly associated with the weakness of the Euro.