Bank of Mauritius Raises Key Interest Rate to 5% to Curb Inflation
The Monetary Policy Committee unanimously lifted the key rate from 4.75% to 5% on 11 November 2026, as inflation climbs toward a projected 5.5%.
The Bank of Mauritius has raised its key interest rate by 25 basis points, moving from 4.75% to 5%, following a unanimous decision by its Monetary Policy Committee on 11 November 2026. The move is designed to bring rising inflation back under control before it accelerates further.
Inflation in Mauritius has been creeping upward in recent months, rising from 4% in July 2026 to 4.3% in October 2026. Without action, the central bank projected that the rate could reach 5.5% by the end of the year, a level that policymakers considered unacceptable.
The Monetary Policy Committee, known as the MPC, is the decision-making body within the Bank of Mauritius responsible for setting the key repo rate, which is the interest rate at which commercial banks borrow money from the central bank overnight. When this rate rises, borrowing becomes more expensive throughout the economy, which typically slows spending and reduces upward pressure on prices.
The decision was unanimous among MPC members, signalling a clear consensus that the inflationary trend posed a credible risk to the economy and that waiting longer was not advisable.
What this means for residents and businesses: A higher key rate is likely to feed through into higher lending rates offered by commercial banks, meaning mortgages, personal loans and business credit will become more expensive. Households with variable-rate loans may see their monthly repayments increase. On the other hand, savers may benefit from improved returns on deposits. The move is a deliberate trade-off: short-term pressure on borrowers in exchange for protecting the purchasing power of the Mauritian rupee over time. Businesses that rely on credit to finance operations or expansion should factor this new rate environment into their planning.
This is the latest in a series of monetary policy adjustments the Bank of Mauritius has made in response to global and domestic price pressures that have affected import costs, food prices and energy in Mauritius. The island's economy, which is heavily reliant on imports, is particularly sensitive to inflation driven by external factors.
The MPC is expected to continue monitoring inflation data and may adjust the rate again at future meetings depending on how prices evolve in the coming months.
Source: Le Defi Media
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Frequently Asked Questions
Why did the Bank of Mauritius raise the interest rate in November 2026?β
The Bank of Mauritius raised its key repo rate from 4.75% to 5% because inflation had risen from 4% in July 2026 to 4.3% in October 2026, and was projected to reach 5.5% by year end. The Monetary Policy Committee voted unanimously to act in order to prevent inflation from becoming entrenched in the economy.
How does the Bank of Mauritius rate rise affect home loans and mortgages?β
When the Bank of Mauritius raises its key rate, commercial banks typically increase their own lending rates in response. Mauritians with variable-rate mortgages or personal loans may see their monthly repayments go up. Those seeking new loans will also face higher borrowing costs. The extent of the increase depends on how individual banks adjust their rates following the central bank's decision.
What is the Monetary Policy Committee of the Bank of Mauritius?β
The Monetary Policy Committee, or MPC, is the body within the Bank of Mauritius responsible for setting the key repo rate, the benchmark interest rate that influences borrowing and saving costs across the Mauritian economy. It meets periodically throughout the year and publishes its decisions publicly. Its primary goal is to maintain price stability while supporting sustainable economic growth.
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