Rwanda’s franc steadies as central bank steps up dollar-selling

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Rwanda's franc steadies as central bank steps up dollar-selling

Rwanda’s franc showed signs of stabilising against the dollar for the past few days after the central bank stepped up its selling of dollars to the currency market.

According to the officials the central bank has sufficient dollars to smooth volatility in its foreign-exchange market and is in talks to raise a stabilizing fund for its currency.

“We have enough USD to protect us against any crisis and fight franc volatility,” Central bank Governor John Rwangombwa told this website.

The bank governor explained that the central bank has been intervening to sell dollars in the foreign-exchange market twice a week.

“We are in talks with the International Monetary Fund for a stand-by facility to prop up the franc”, Rwangombwa said adding that there is no deal on the table yet.

The central bank holds foreign exchange equal to 4.3 months of imports, Chief Economist Kigabo Thomas revealed.

“The central bank has been very visible in the past week and it’s already influencing the market. We believe the franc can recover some of the losses if this continues, another economist predicted.

Inflation may accelerate to 3.5 percent by December, the central bank said in a statement on its website Thursday.

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Olive Ndaka is the Junior Editor for RwandaEye. An investor and young entrepreneur, she is a quick learner and has contributed many articles for RwandaEye in Kinyarwanda.

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