Rate Rise to 5%: How It Affects Your Loan and Savings in Mauritius
The Bank of Mauritius raised its key rate to 5% on 11 November 2026 to fight rising inflation. Here is what changes for borrowers and savers.
The Bank of Mauritius, the island's central bank, raised its key interest rate, known as the Key Repo Rate, from 4.75% to 5% on 11 November 2026. The decision was driven by a steady rise in inflation, which climbed from 4% in July 2026 to 4.3% in October 2026, while the year-on-year inflation rate reached 6.4%. The central bank's move is a classic monetary policy tool: by making borrowing more expensive, it aims to cool consumer spending and slow the rise in prices.
For anyone with a variable-rate loan, such as a home mortgage, a car loan or a personal credit facility, this increase is likely to translate into higher monthly repayments. Banks in Mauritius typically adjust their lending rates in line with movements in the Key Repo Rate, though the timing and size of any pass-through varies by institution. Borrowers should check with their bank whether their loan agreement is linked directly to the Key Repo Rate or to the bank's own base lending rate.
For savers, the picture is more positive. Higher interest rates tend to push up returns on fixed deposits and savings accounts. If commercial banks pass the rate increase on to depositors, households keeping money in term deposits could see marginally better returns than they have enjoyed over the past two years, when rates were held lower to support economic recovery after the pandemic.
The timing matters because Mauritius is also dealing with imported inflation. The rupee has faced pressure against the US dollar and the euro, making imported goods, fuel and food more expensive. The rate rise alone will not resolve cost pressures that originate abroad, but it signals that the Bank of Mauritius is prioritising price stability over cheap credit.
What this means: If you have a variable-rate mortgage or any loan with a floating interest rate in Mauritius, contact your bank to find out whether your monthly instalment will increase and by how much. If you are a saver, ask about current fixed-deposit rates, as some banks may revise offers upward in the coming weeks. Businesses that rely on credit to manage cash flow or fund investment should factor in higher borrowing costs when planning for the months ahead. The central bank has not signalled whether further increases are planned, so the situation remains one to watch closely.
Source: Le Defi Media
Frequently Asked Questions
What is the Bank of Mauritius Key Repo Rate and why does it matter?β
The Key Repo Rate is the benchmark interest rate set by the Bank of Mauritius, the country's central bank. Commercial banks use it as a reference for setting their own lending and deposit rates. When the Key Repo Rate rises, borrowing typically becomes more expensive and savings returns tend to improve. It was raised to 5% on 11 November 2026.
Will my mortgage repayment go up after the rate rise in Mauritius?β
If your mortgage or loan in Mauritius carries a variable interest rate linked to the Key Repo Rate or your bank's base rate, your monthly repayment is likely to increase. The exact impact depends on your bank and your loan contract. Contact your lender directly for a revised repayment schedule.
What is the current inflation rate in Mauritius in 2026?β
As of October 2026, the annual inflation rate in Mauritius stood at 4.3% on a monthly comparison basis, while the year-on-year rate reached 6.4%, up from 4% recorded in July 2026. These figures prompted the Bank of Mauritius to raise its key rate.
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