Policy Dialogue on Inflation - February 2023 - Public-Private Policy Dialogue organised by EPRN

BNR RESTRICTED Global Inflation Developments Inflation is expected to fall but remains elevated World Inflation is projected to decrease from 8.8% 6.6% 2022 TO 2023 BNR RESTRICTED Global Commodity Price Developments and outlook (y-o-y) Global Energy Index Crude Oil Projected to +66.6% +18.7% -11.2% +34.6% +8.9% 2022 Q3 TO 2022 Q4 2023 2022Q3 TO 2022Q4 Agriculture Non-Energy Commodities Index Proje. [...] BNR RESTRICTED Inflation Developments Core Inflation increased from 2.1% 11.0% 2021 2022 TO Fresh food Inflation rose from -4.2% 24.6% 2021 TO 2022 Energy Inflation increased from 1.8% 17.4% 2021 TO 2022 BNR RESTRICTED Inflation Outlook • International commodity prices Recent inflation at including energy and food are 20.7% projected to continue declining over the medium term, easing pressures Jan. [...] BNR RESTRICTED Monetary Policy BNR RESTRICTED What is the Central Bank Rate (CBR)? • The central bank rate is the rate at which the National Bank of Rwanda lends short term money to commercial banks. [...] BNR RESTRICTED How does the Central Bank Rate affect inflation? Thus, central banks often reduce the CBR, the same trend is followed by all other interest rates including the interest rate at which banks lend to the public. [...] BNR RESTRICTED How does the Central Bank Rate affect inflation? • To summarize: after analyzing economic indicators’ performance and forecast, the Monetary Policy Committee of the BNR will decide on the Central Bank rate intended to keep the economy in balance.