Bank of Mauritius Raises Key Interest Rate to 5%

The Bank of Mauritius has raised its key interest rate by 25 basis points to 5%, the Monetary Policy Committee announced on Wednesday, November 11. This decision was made in response to rising inflation, which increased from 4.4% in July to 6.4% in October. The central bank expects inflation to exceed its target range of 2% to 5% in 2027.

The Monetary Policy Committee's decision to raise the key rate was unanimous. This move aims to address the growing inflationary pressures in the country. The Bank of Mauritius has been closely monitoring the economic situation, taking into account both local and global factors. The global economy has shown resilience, but growth prospects remain uncertain due to geopolitical tensions.

This is not the first time the Bank of Mauritius has adjusted its key interest rate in recent times. In May, the rate was increased by 25 basis points, from 4.50% to 4.75%. Prior to that, the rate had been maintained at 4.5% for some time. In February 2022, the rate was increased by 50 basis points, from 4% to 4.50%, as inflationary pressures began to build.

The Bank of Mauritius has been proactive in its monetary policy decisions, seeking to balance the need for economic growth with the need to control inflation. The central bank's target range for inflation is between 2% and 5%. With inflation expected to exceed this range in 2027, the Bank has taken steps to tighten monetary policy.

The decision to raise the key interest rate may have implications for borrowing costs and economic growth in Mauritius. Higher interest rates can make borrowing more expensive, which could slow down economic activity. However, the Bank of Mauritius is likely to prioritize controlling inflation, given its commitment to maintaining price stability.

The global economic environment is also a consideration for the Bank of Mauritius. Geopolitical tensions, particularly conflicts in the Middle East, have created uncertainty around global growth prospects. As a result, the Bank has to carefully balance its monetary policy decisions to ensure that they are consistent with both local and global economic conditions.

The Bank of Mauritius will continue to monitor the economic situation and adjust its monetary policy as needed. The central bank's commitment to price stability and economic growth will guide its decision-making process. For now, the key interest rate has been raised to 5%, a move aimed at addressing rising inflationary pressures in the country.

Key points

• The Bank of Mauritius raised its key interest rate to 5% on November 11, 2026.
• Inflation in Mauritius rose from 4.4% in July to 6.4% in October.
• The central bank expects inflation to exceed its target range of 2% to 5% in 2027.