LUSAKA, Dec 21 (Reuters) - Zambia has capped lending rates at 18.25 percent to make borrowing from commercial banks more affordable, the central bank said on Friday.
“This cap is arrived at by adding a factor of 9 percent to the policy rate which currently stands at 9.25 percent,” the Bank of Zambia said in a statement.
It said this was effective from Jan. 2.
The Bank of Zambia said the measure would apply to new loans, while existing loans would run on existing terms.
The central bank increased its benchmark interest rate by 25 basis points in October, saying its monetary policy committee had noted upward risks to inflation. It left the rate unchanged at 9.25 percent in November.
Annual inflation quickened to 6.9 percent in November, mainly due to higher food prices, the latest data from the Central Statistical Office shows. (Reporting by Chris Mfula; Writing by Stella Mapenzauswa; Editing by Ed Stoddard)