In response to a Private Notice Question from the Leader of the Opposition in the National Assembly on Tuesday 15 July 2025, the Prime Minister, Dr. Navinchandra Ramgoolam, provided an overview of the measures taken by the Government and the Bank of Mauritius to stabilize the Mauritian rupee and manage inflation.
He explained that several decisive steps have been implemented. Firstly, in December 2024, the central bank introduced reforms in the foreign exchange market by instructing all FX transactions, including swaps and derivatives, to be conducted solely through licensed institutions. Additionally, it enhanced due diligence on intercompany FX dealings to prevent distortions from the parallel market.
In February 2025, the Bank of Mauritius adjusted the key interest rate, raising the Repo Rate from 4.0% to 4.5% to support currency stability. It also issued guidance to banks to ensure that FX forward pricing was aligned with market fundamentals. Discrepancies between the Financial Services Commission and the Bank of Mauritius regarding FX oversight, particularly concerning Treasury Management Companies, were resolved to strengthen regulatory coherence. To foster ongoing collaboration, the Bank has instituted regular monthly meetings with banking treasurers, ensuring a coordinated approach to maintaining market stability.
Dr. Ramgoolam noted that these interventions have yielded positive results. The rupee has stabilized on a trade-weighted basis, appreciating by 4.8% against the US dollar, although it has depreciated slightly against the euro and pound sterling.
To help shield the public from rising prices, especially for essential goods, the Prime Minister outlined several anti-inflationary measures. These include a Rs 5 per litre reduction in fuel prices since December 2024, targeted price controls with markup limits of 25–30% in Mauritius and 5 – 8% in Rodrigues and the removal of VAT on basic goods such as frozen and canned vegetables, infant nutrition, and baby food — reducing retail prices by approximately 15%. The Ministry of Commerce has also increased enforcement efforts to ensure compliance.
Furthermore, a Rs 10 billion Price Stabilisation Fund has been established, with an initial contribution of Rs 2 billion, to support ongoing consumer protection initiatives.
Concluding his statement, the Prime Minister reaffirmed the Government’s commitment to a new economic framework based on investment, innovation, exports and local production. He emphasized the need to shift from an economy heavily reliant on consumption and imports towards one driven by investment, technological advancement and increased domestic production. He highlighted efforts to produce more locally, generate cleaner energy and reduce the trade and fiscal deficits, as well as the national debt relative to GDP, to ensure sustainable economic growth.