Rwanda Central Bank Governor Soraya Hakuziyaremye made the revelation during a press conference on Thursday, May 15, following a recent Monetary Policy Committee (MPC) meeting.
Addressing growing interest in gold among central banks in the East African Community (EAC) region, Governor Hakuziyaremye said Rwanda's central bank conducted a detailed study on incorporating gold as an additional reserve asset.
The move follows a trend observed by the EAC Central Bank Monetary Affairs Committee, which noted several regional central banks considering gold to diversify and strengthen their reserves.
'Given gold's ability to counter shocks in the financial market and serve as a hedge against external uncertainties, we have decided to explore it as a new asset class,' Governor Hakuziyaremye explained.
The central bank boss emphasised that capital preservation, liquidity, and reasonable returns remain the primary objectives for the central bank's foreign reserves investments.
'The good news is that gold meets these criteria at this time, which makes our consideration positive,' she said.
The central bank has already secured board approval to include gold investments in its portfolio.
However, Governor Hakuziyaremye highlighted that gold is a new asset for the bank, and further updates on acquisition volumes and expected returns will be communicated by the end of the current financial year.
'This is a learning process, and as we continue benchmarking with our peers, we plan to start adding gold to our reserves from July 2025,' she said.
Meanwhile, the bank maintained the lending rate at 6.5 percent, a level Governor Soraya noted is aimed at keeping inflation within the targeted 2 to 8 percent range.
Commenting on the economic outlook, she said headline inflation rose to 6.7 percent in the first quarter of 2025, up from 5.2 percent in the previous quarter, largely driven by increases in core and fresh food prices. Core inflation climbed to 6.1 percent, while fresh food inflation surged to 11.2 percent, mainly due to a base effect from unusually low prices in early 2024 and rising meat prices.
Despite the uptick, inflation remains within the medium-term target range and is expected to average 6.5 percent in 2025 before easing to 3.9 percent in 2026.
'Inflationary risks remain, particularly from global geopolitical tensions and shifting trade policies,' the central bank governor warned, but emphasized that the current rate should continue to anchor inflation expectations.
The recent MPC meeting also noted Rwanda's ongoing economic resilience, with the Composite Index of Economic Activity (CIEA) registering a 9.3 percent year-on-year increase in Q1 2025, supported by robust industrial and services performance. The economy grew by an impressive 8.9 percent in 2024, buoyed by a rebound in agriculture and strong domestic demand.
However, Rwanda's trade deficit widened by 10.8 percent in Q1 2025, as merchandise exports fell by 3.0 percentâ€"mainly due to declining re-exportsâ€"while imports rose 5.8 percent, driven by increased demand for machinery and raw materials. This put pressure on the Rwandan franc, which depreciated by 2.46 percent against the U.S. dollar by the end of April.
Wycliffe Nyamasege
Source : https://en.igihe.com/business/article/rwanda-s-central-bank-to-begin-investing-in-gold-starting-july
