Central Bank of West African States Holds Rate at 4.25%

The Central Bank of West African States [BCEAO] maintained its marginal lending facility rate at 4.25%, the minimum open market rate at 3.25% and the bank reserves requirement at 7.00%.  The BCEAO said in a statement [translated]: "During this session, the Committee considered the economic, financial and monetary recent West African Monetary Union, including the risks to price stability and economic growth prospects in the EU. In this regard, the Committee noted a trend toward slower pace of price growth." 

The Central Bank of West African States also held its interest rates unchanged earlier this year.  The West African States (Benin, Burkina Faso, Cote d'Ivoire, Guinea Bissau, Mali, Niger, Senegal, Togo) saw their inflation rate rise to 3.9% in December 2010 from 2.6% in September.  Meanwhile the Bank expects the inflation rate to average 3.6% in the third quarter of this year, compared to 4.8% in the second quarter.  The Bank also noted it expects GDP growth of 1% this year for the 8-member West African monetary union, and for economic growth to recover to 5.3% in 2012.

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