Laos tightens monetary policy to ease inflation

Illustrative image (Photo:laotiantimes.com)

The Bank of the Lao PDR is set to further increase interest rate on Lao kip deposits from 10% to 10.5% per year to alleviate inflationary pressures currently affecting the economy, reported the Vientiane Times.

The interest rate on foreign currency deposits will also rise from 10% to 11%.

The central bank recently approved a resolution to raise the basic interest rate for kip on a 7-day term, from 8.5% to 10% per annum.

It will continue following the policy of maintaining a centralised foreign exchange market under state management, while also managing foreign currency and developing a payment system that connects domestic and international banks to promote the use of kip.

Inflation in Laos continued to rise in July 2024, reaching 26.1% month-on-month, amid a weakening kip and rising global fuel prices./.

VNA