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Golden Sibanda Senior Business Reporter

Banks should now be able to lend money to the productive sector at lower rates after the Reserve Bank of Zimbabwe’s (RBZ) Monetary Policy Committee (MPC) yesterday resolved to reduce the overnight bank rate from 70 percent to 35 percent.

The MPC, which was appointed in September this year, was meeting for the second time.

It also deliberated on measures to ensure stability of the exchange rate,and smooth functioning of the interbank market.

RBZ Governor Dr John Mangudya said the MPC also welcomed the 2020 national Budget which seeks to boost productivity, growth and job creation.

“To this end, the bank rate, currently at 70 percent, requires review; notwithstanding a recent spike in monthly inflation to 38,8 percent due to shocks caused mainly by adjustments of electricity and fuel prices, the inflation outlook is positive.

“Consequently, the committee resolved to revise the bank policy rate from 70 to 35 percent with effect from November 20, 2019. This position will be reviewed at future meetings,” said Dr Mangudya said.