DR Congo hikes interest rates to curb inflation

The Democratic Republic of Congo’s central bank has doubled its base interest rate to 14 percent in an effort to contain inflation which is currently running in double digits.

Congo’s interest rates stood at 7 percent previously.

Inflation for December was 11.2 percent, well over the bank’s target of 4.2 percent.

The country which is Africa’s leading copper producer has been battered by low commodity prices that have hit the Congolese franc.

A recent report by the Central Bank suggests that the economy is expected to have decelerated to a six-year low of 4.3% growth in 2016

Adding to the economic woes is the political uncertainty caused by President Joseph Kabila to stand down last year.

A Catholic church mediated process and which was agreed on by political players in the country has brought in calm but risks still remain.

Analysts say the economy could gain steam as commodity prices are expected to recover next year.

But the prospects of social unrest and flagging demand for exports, however, could undermine the recovery.