The global economic activity continued to recover gradually from the effects of the COVID-19 pandemic and Russia’s invasion of Ukraine.

The Governor of the Central Bank of Lesotho, Dr Emmanuel Maluke Letete said this during the press briefing of the Monetary Policy Committee (MPC) held at the CBL premises in Maseru.

Dr Letete announced that the MPC has decided to revise the Net International Reserve (NIR) target floor from US$820 million to US$710 million, saying at this level, the NIR target will be sufficient to maintain a one-to-one exchange rate peg between Loti and the Rand.

He further mentioned that they have left the CBL interest rate unchanged at 7.75 percent per annum.

He said this comes after the committee considered the Net International Reserves (NIR) developments and outlook, regional inflation and interest rates outlook, domestic economic conditions and the global economic outlook.

However, he said even though the economic activity continued to recover, some lingering challenges are expected to slow down the global economy, saying these challenges include high inflation rates, policy tightening by central banks, high debt levels, deepening geo-economics fragmentation and rising climate change risks, therefore, global economic growth is projected to slow down to 3.0 percent both in 2023 and 2024 from 3.5 percent in 2022.

In conclusion, Dr Letete said the committee will continue to closely assess the global economic developments and their impact on the domestic economy, especially the NIR and respond accordingly.

This was the 103 meeting held by the Monetary Policy Committee of the Central Bank of Lesotho.

By Staff Reporter: Noliwe Velaphe