Rwanda had had its own currency and central bank for some years, and from 1974 it was fixed to the USD, in a limited financial system. After the immense disruption of the 1994 genocide, it moved over a long period towards a more modern monetary and financial system with flexible exchange rates and indirect monetary instruments, and a stronger commitment to price stability.

Years Targets and attainment Classification
1974-93 currency pegged to USD, no autonomous forex market; limited banking system, with central bank sometimes funding fiscal deficits, lending to public enterprises, and using global credit ceilings, moral suasion and rediscount facilities vis-à-vis commercial banks; 1977-78 credit controls restructured, become main instrument; important but seasonal flows of coffee production have major effect on bank lending; one-off rise in  interest rates late 1979; 1983 peg to SDR, with some depreciation vs USD, but most of overvaluation developed since 1980 not unwound; downward adjustment of interest rates 1987; late 1990 large devaluation, plus stabilisation policies and  various structural reforms; 1990-3 armed conflict worsens existing economic difficulties; mid-1992 further devaluation augmented exchange rate fix AERF
1994 1994 genocide followed by civil war and new government, with return of previous exiles, and displacement of new refugees internally and to neighbouring countries; acute adverse economic effects include loss of skilled personnel from key state and financial institutions (with severe but largely temporary disruption to statistics) unstructured discretion UD
1995-2017 1995 rehabilitation of central bank and restructuring of commercial banks (which have large amounts of non-performing loans); replacement of old high denomination banknotes by new; programme of stabilisation and wider structural reform including increased use of reserve requirements and rediscount facilities, some liberalisation and wider variation of interest rates, market-determined exchange rate, and increase in autonomy of central bank; efforts to resettle returning old and new exiles; by 1997 economic rebound, with GDP up and inflation down; forex rationing and reluctance to allow depreciation leads to re-emergence of varying parallel market premium, largely eliminated by weekly forex auctions 2001; reserve money programming complicated by unstable money multiplier, reserve money targets often exceeded; by 2007 exchange rate is managed and stable; commercial bank weaknesses gradually reduced; more issues of and OMOs in bills, bonds and repos; monetary policy more proactive from 2010, but monetary transmission remains weak; exchange rate corridor as part of (sustained) move towards more flexible exchange rates; 2012 reserve money targeting made more flexible, standing facilities create corridor for repo policy rate; improvements in central bank expertise and communication; 2017 absorption of excess liquidity encourages use of interbank market, aim is transition to indirect and price-based monetary instruments with more focus on inflation; statistical database now improved loosely structured discretion LSD

Selected IMF references: RED 1972 pp25-8, 40-1; RED 1975 pp28-9, 41; RED 1977 pp31-2; RED 1978 pp29-31, 93-4; SR 1980 pp7-8; RED 1983 pp34; RED 1984 pp44-5, 57; SR 1984 pp10-11; RED 1985 pp42-5, 62; SR 1985 pp11-12; RED 1988 p9; SR 1989 pp13-15; SR 1991 pp7-9, 20; SEBP 1995 pp1-8, 19, 20; SR 1995 pp11, 14-15, 25; SISA 1996 pp5, 10-12; SR 1998 p13;  SR 1999 pp10, 14; SR 2000 p8; SR 2002 pp17-18; SR 2007 pp13, 16-17; SR May 2008 pp7-8; SR December 2008 p24; SR 2010 pp15, 24-6; SR 2013 pp14-15, 52-3; SR 2014 pp18-19; SR 2017 pp9-10, 19-20, 59-60.

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