Rwanda’s Economic Outlook Updated as Inflation Risks Persist and Gold Investments Grow

Kigali, Rwanda — The National Bank of Rwanda has revised its inflation forecast upward for 2025, citing recent inflationary pressures and global economic uncertainties. In a press conference held today, Thierry Kalisa, Chief Economist of the bank, highlighted that inflation, which reached around 7.3% in June and July, has prompted the central bank to adjust its projections.

“We previously projected a 6.5% inflation rate for 2025, but due to recent developments, we have revised this up to an average of 7.1%,” Kalisa explained. While this level remains below the 8% threshold, he emphasized that risks such as fluctuating global commodity prices, weather conditions affecting agriculture, and geopolitical tensions could influence the inflation trajectory.

To mitigate the risk of inflation exceeding 8%, the Monetary Policy Committee (MPC) recently increased the policy rate by 0.25%. Kalisa noted that this measured response aims to contain inflation while maintaining flexibility for future adjustments, depending on upcoming economic data.

“We review these projections quarterly, and the next assessment will determine whether further action is necessary,” he added. The MPC’s decisive move reflects a commitment to keeping inflation stable, especially after years of high inflation pressures in previous years.

On the exchange rate front, the bank recognizes the slowdown in currency depreciation compared to last year, which aligns with a normalization trend following earlier pressures in 2023. Export performance in the second quarter has also been strong, providing additional stability to the exchange rate and alleviating concerns about exchange rate-driven inflation.

In related news, the Governor of the National Bank of Rwanda, Solaya Hakuziyaremye, shared insights into the country’s gold investment strategy. Starting this financial year, Rwanda has begun allocating funds to gold as part of its foreign reserves diversification plan. She highlighted that gold remains a liquid asset—sought after by central banks worldwide—and aligns with the bank’s goals of securing stable, attractive returns.

While specific figures on the current gold holdings will be detailed in the upcoming end-of-year financial report, Hakuziyaremye reassured that Rwanda’s reserves remain robust, surpassing four months of import coverage as of June 2025.