Short-term loans from the Central Bank of Congo: an analysis of the economic situation
The Central Bank of Congo recently published a note on the economic situation which highlights the short-term loan operations recorded within the institution. According to the reported data, the weekly trading volume stood at 110.0 billion Congolese Francs (CDF) as of August 4, 2023.
Interestingly, this figure marks a significant drop from the previous year, when the cumulative volume of operations reached 4,015.5 billion Congolese Francs. This reduction testifies to a certain prudence of credit institutions in their requests for short-term liquidity.
In addition, the note from the Central Bank of Congo highlights the absence of transactions recorded at the window of the standing facilities during the first week of August 2023. On the other hand, the volume of transactions carried out in July s amounted to 1,926.7 billion Congolese Francs. This difference can be attributed to various factors, such as variations in the demand for liquidity or the management strategies of credit institutions.
Similarly, the interbank market experienced an absence of operations during the week under review, unlike in July when a volume of 40.0 billion Congolese Francs was recorded. To date, the volume of cumulative transactions in this market stands at 215.0 billion Congolese Francs, compared to 1,306.0 billion Congolese Francs in 2022.
Regarding the interest rates applied, they vary between 10.0%, 11.0% and 12.0% for the interbank market, short-term loans and standing facilities, respectively. These rates are determined according to the monetary context and are likely to vary according to economic developments.
The Central Bank of Congo’s short-term loan window can be considered as a means of refinancing that offers liquidity to credit institutions, on request, for a maximum period of 7 renewable days. This operation requires a prior pledge of quality effects. Thus, credit institutions can access funds quickly and flexibly through this window.
In conclusion, the analysis of the economic situation of the Central Bank of Congo highlights the short-term loan operations carried out within the institution. The figures show a significant drop compared to the previous year, which testifies to increased caution on the part of credit institutions. This information makes it possible to better understand the trends of the Congolese financial market and to anticipate future developments