BCEAO keeps key interest rate unchanged at 2.50 percent

The central bank of the eight-nation West African franc zone (BCEAO) kept its prime lending rate unchanged at 2.50 percent at a quarterly rate meeting on Wednesday.

The bank has kept the rate unchanged since September 2013, when it lowered it by 25 basis points.

Issa Djibo, head of economic analysis at the bank, said it had also left its growth forecast for the monetary bloc unchanged at 6.6 percent for this year.

Central bank governor Tiemoko Meyliet Kone said it was analysing the risk to the regional economy from the outbreak of the deadly Ebola virus in the region.

BCEAO serves francophone Benin, Burkina Faso, Ivory Coast, Mali, Niger, Senegal and Togo plus Portuguese-speaking Guinea-Bissau, with total economic output estimated at around $80 billion a year.

All but one of the countries affected by Ebola — Sierra Leone, Guinea, Liberia and Nigeria — are outside the franc currency zone.

However, Senegal – a member of the currency bloc – reported its first case last week: a 21-year-old student who arrived from neighbouring Guinea.

Travel restrictions to affected countries have also disrupted regional commerce and transport in West Africa.

“The main risk is that the disease spreads and is not contained,” Kone said, without providing detailed figures. “It could have an impact on economic production in our countries and trade.”

The bank said that inflation would end the year at 0.5 percent. However, it forecast an annual inflation rate of around 2 percent after 24 months.