23/09/2025
Bank of PNG Raises Kina Facility Rate to 5.0%
The Bank of Papua New Guinea (BPNG) has raised the main interest rate to 5.0% and lowered the cash reserve requirement to 9.0%. These changes are made to control prices, support the Kina, and help the economy grow in the right way.
What does this mean for ordinary people? First, prices in shops are not going up as fast as before. Inflation is slowing down, so the cost of food and goods will rise more slowly. This helps protect the value of our money.
Second, loans from the bank, like for school fees, cars, or business, may become more expensive to repay. This is because higher interest rates make borrowing a bit harder. At the same time, savings in the bank could now earn more interest. This means saving money will give people a little extra benefit.
Third, a stronger Kina can make imports like fuel, rice, flour, and spare parts cheaper. This will help reduce costs for families and businesses that rely on imported goods.
In everyday life, this means food prices are sure rising more slowly, bank savings can grow a bit more, loans will be slightly more costly, and imported items like fuel may become cheaper.
Overall, Papua New Guinea’s economy is improving. Inflation is coming down, the Kina is being supported, and confidence is returning. These actions by the Bank of PNG are steps toward a more stable and better future for our country.
Sources:
- Bank of Papua New Guinea - Monetary Policy Statement (Sept 2025)
- PNG Business News: Bank of PNG Raises Kina Facility Rate to 5.0% as Inflation Eases (Sept 2025)
The Bank of Papua New Guinea’s Monetary Policy Committee (MPC) has announced key policy adjustments aimed at reinforcing price stability and strengthening the role of the exchange rate as the nominal anchor for monetary policy. In its 2 September meeting, the Committee increased the Kina Facility ...