November 10, 2014 / 12:08 PM / 5 years ago

Mauritius central bank sees inflation at 3 pct by year end

A vendor sells chillies at a food market in Port Louis June 26, 2008. REUTERS/Ed Harris

PORT LOUIS (Reuters) - Mauritius’ central bank said the year-on-year inflation rate could fall to 3 percent by the end of this year from 4 percent last year, according to minutes from its October meeting of the monetary policy committee (MPC) released on Monday.

However, some policymakers were concerned over domestic wage pressures in the Indian Ocean island state, citing the build-up in domestic wage pressures ought to be contained otherwise domestic inflation would outstrip imported inflation.

The minutes of the MPC meeting showed that inflation was expected to decline marginally during the fourth quarter to “about 3.0 percent for December 2014.”

The central bank or Bank of Mauritius’ MPC left its key repo rate unchanged at 4.65 percent last month, and maintained its growth forecast for this year in a range of 3.4 to 3.6 percent.

Since March, headline inflation has been virtually flat at about 4.0 per cent. The year-on-year rate has also dropped from 4.5 percent in March to 1.9 percent last month.

The central bank projected year-on-year consumer price inflation to remain low in the first quarter of 2015, but said it would thereafter pick up against the premise of cost-push factors, potentially the outcome of seasonal factors.

Reporting by Jean Paul Arouff; Editing by Toby Chopra

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