Business Consultant, Mubamba Sichilongo, says the recent adjustment of the Monetary Policy Rate (MPR) by the Bank of Zambia (BoZ) will lead to an increase in loan interest rates, making borrowing more expensive.
On February 12, 2025, the BoZ raised the MPR by 50 basis points, from 14.0% to 14.5%.
Speaking in an interview with RCV News in Lusaka, Mr. Sichilongo explained that the interest rates on loans will rise as a direct result of the MPR adjustment.
“The Monetary Policy Rate is the benchmark interest rate set by the Central Bank and is used to regulate the cost of borrowing and when the MPR is adjusted upwards, the cost of borrowing also increases,” said Mr. Sichilongo.
He further noted that while the adjustment may have some unintended consequences, its primary objective is to manage inflation within the desired range.
By Margaret Mwanza
