HARARE, (Reuters) – Zimbabwe’s central bank said on Wednesday it would cut its main lending rate to 15% from 25%, effective May 1, as part of measures to help the economy deal with the effects of the coronavirus outbreak.
The southern African nation’s economy was already experiencing its worst crisis in a decade, with fast rising inflation and shortages of food and other basic goods.
The central bank said in a statement it had cut rates “with the expectations that banks will do the same to provide affordable financial facilities to their customers during these challenging times”.
It said it had set aside 3 billion Zimbabwe dollars ($120 million), which banks could borrow at 10% per annum for on-lending to clients.
Last month, the central bank set a fixed exchange rate and allowed the use of foreign currencies in domestic transactions as part of measures to support the economy against the coronavirus pandemic.
Zimbabwe has recorded 32 confirmed cases of the new coronavirus and four deaths.