West Africa central bank trims rates, growth forecast

 
The central bank of the eight-nation West African franc zone (BCEAO) cut its prime lending rate by 25 basis points to 2.50 percent on Wednesday and trimmed it economic growth forecast for this year, its governor said.

Tiemoko Meyliet Kone

   Tiemoko Meyliet Kone said the bank had reduced its outlook for economic growth in the region to 6.4 percent, from 6.5 percent, for 2013. He said there were also risks to the projected 7.3 percent growth next year.
   The negative impact of a slowdown in emerging economies on commodity prices, on which most of the region depends for export earnings, was a major risk to regional growth, he said.
   "The monetary policy committee has decided to lower rates by 25 basis points," Kone told reporters as he left the committee meeting. The central bank left rates unchanged at its previous policy meeting in June.
   Inflationary pressures should continue to ease, with consumer price inflation running at about 1.9 percent in 2013 versus 2.4 percent the previous year, the bank said.
   The BCEAO serves francophone Benin, Burkina Faso, Ivory Coast, Mali, Niger, Senegal and Togo plus Portuguese-speaking Guinea-Bissau. Their total economic output is estimated at around $80 billion a year.
   Ivory Coast, the world's top cocoa producer, is the biggest economy of the region.
   The states all use the CFA franc common currency, tied to the euro at a fixed exchange rate of one euro to 655.957 CFA francs, with the peg guaranteed by the French treasury.