Last Wednesday, the Monetary Policy Committee (Cpm) of the Central Bank of West African States (BCEAO) held by videoconference, its fourth ordinary meeting for the year 2021. Under the chairmanship of Tiémoko Meyliet Koné, Governor of the Central Bank, its Statutory President, the Cpm has taken many resolutions.

At the end of the work, the Cpm decided to keep unchanged the minimum interest rate for bidding on liquidity injection tender operations at 2.00% and the interest rate of the loan window. marginal at 4.00%, levels in force since June 24, 2020. The reserve requirement coefficient applicable to banks in the Union remains unchanged at 3.0% since March 16, 2017.

According to the final communiqué of the meeting, the Committee noted a firming up of economic activity in the third quarter of 2021, with growth, at an annual rate, of 6.7% after 7.7% in the previous quarter. The execution of financial operations by WAEMU member states during the first nine months of 2021 shows a widening of the overall deficit, commitment basis, including grants, which stood at 4,492.8 billion at the end of September 2021, compared to 4,388.4 billion a year earlier.

On the money market, interest rates continued to ease during the third quarter of 2021. The weighted average interest rate on the interbank market, all maturities combined, fell slightly, standing at 2 .60% in the third quarter of 2021 against 2.61% a quarter earlier and 3.01% in the same period of the previous year. The average bank lending rate, excluding taxes and charges, also fell between the second and third quarters of 2021 to stand at 6.22% against 6.36%.

Claims on the economy increased, with an annual increase of 8.9% at the end of September 2021. Net foreign assets also increased by 26.2% in the third quarter of 2021. The money supply increased, at an annual rate, by 17.5% at the end of September 2021. The Union's foreign exchange reserves at the end of September 2021 correspond to a coverage rate of the monetary issue of 81.7% and provide the Union with 6.1 months of imports of goods and services.

The Cpm noted an increase in inflation, standing at 3.8% in the third quarter of 2021 against 3.3% a quarter earlier. The underlying inflation rate also rose, standing at 3.0%, after 2.7% a quarter earlier. Inflation is forecast to return below 3.0% sometime in 2022.

On the commodity markets, the prices of energy products continued to strengthen. The price indices of non-energy raw materials exported and food products imported by UEMOA countries also increased during the third quarter of 2021. For their part, the prices of non-energy products recorded a slight drop.