Rwanda Raises Policy Rate To 8.75 Percent As Inflation Stays Elevated

Kigali, August 27, 2026 - The National Bank of Rwanda raised its Central Bank Rate by 50 basis points to 8.75 percent, the highest level since 2009, as policymakers moved to contain persistent inflationary pressure.

The decision marked the third consecutive rate increase and brought cumulative tightening to 175 basis points since November 2025. Inflation rose from 9.1 percent in the first quarter to 13.2 percent in the second quarter, then reached 14.5 percent in July. Energy inflation hit 45.7 percent in the second quarter, while core inflation stood at 12.3 percent.

The central bank expects inflation to remain above the 2 percent to 8 percent target band through much of 2026 before easing toward 7.9 percent in 2027. The economy remained strong, expanding 10 percent year on year in the first quarter, but tighter monetary conditions may raise financing costs for businesses and households.

External trade data showed merchandise exports up 51 percent in the second quarter, driven by minerals, non-traditional exports and re-exports. Imports rose 28 percent, widening the trade deficit to $821.9 million.

Rwanda's minerals sector remains strategically important. The Nyakabingo tungsten mine supplies a significant share of United States primary tungsten concentrate, while China remains a major destination after Rwandan mineral ores received duty-free access from May 1, 2026.