BCEAO: Key interest rate remains at 3%, inflation rises in UEMOA

The Central Bank of West African States (BCEAO) maintained its key interest rate at 3% on Wednesday, September 9, 2026, following the third ordinary meeting of its Monetary Policy Committee in Dakar. The marginal lending rate remains set at 5%, while the reserve requirement ratio stays at 3% for the member institutions of the Union.

This decision extends the current levels that have been in place since March 16, 2026, after a 25 basis point cut announced in March. It directly impacts banks and financing conditions in the eight countries of the West African Monetary Union, including Benin.

The status quo comes as inflation begins to rise again within the Union. It was recorded at 0.4% in the second quarter of 2026, up from -0.2% in the previous quarter. The BCEAO now forecasts an average inflation rate of 1% for the entire year of 2026, compared to 0% in 2025.

The Central Bank attributes this increase primarily to rising transportation costs, linked to the increase in fuel prices in most member states, as well as to higher housing costs and the prices of certain food products, particularly meat, fish, and vegetables.

Regional growth expected at 6.1%

Economic activity remains robust. Growth in the Union is estimated at 6% year-on-year in the second quarter of 2026, following 6.1% in the previous quarter. For the entire year, the BCEAO anticipates a real GDP growth of 6.1%.

Financing for the economy also remains dynamic. Bank credit to the private sector increased by 6.6% by the end of June 2026, compared to 6% at the end of March. The Union’s external position has strengthened, particularly driven by the increase in the value of exports of gold, cotton, cocoa, and petroleum products.

The Monetary Policy Committee indicates that it will continue to monitor risks to prices and monetary conditions, in a context marked by uncertainties related to the conflict in the Middle East. The BCEAO reserves the right to adjust its policy if these risks threaten the monetary and financial stability of the Union.