Banco de Cabo Verde
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Monetary Policy Report 2018

The overall benign performance of the external environment favored the remarkable dynamics of the national economy, which grew by 4.7 percent year-over-year in the first half-year.

The economy also benefited from the contained growth of inflationary pressures, as well as stronger confidence of economic agents, which favored demand and the (internal) conditions for financing the economy. The benign performance of some fields of activity and exports contributed to ease the current account and, consequently, to improve the external accounts.  

 

Banco de Cabo Verde expects a 4.5 percent economic growth and a 1.3 percent average annual inflation for the year’s end. Based on the expected benign developments in the external environment and the absence of infrastructural and commercial constraints on domestic production and the external financing of investments in the country, the baseline scenario for the central bank's projections for 2019 suggests a slight increase in the growth rate of the economy and inflation, compared to 2018.

 

The recent dynamics of the economy is an opportunity to strengthen the country’s productive capacity, through the implementation of policy measures (also of a microeconomic nature), reduce its vulnerability to external shocks, and reduce the country risk premium, which increases the cost of investments financed with external capital.

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