By Bloomberg

Zimbabwe’s central bank left official interest rates unchanged after its first meeting since the adoption of a new inflation measure to reflect wider US dollar use in the economy.

The monetary policy committee held the key rate at 130%, according to a statement emailed on Monday from the capital, Harare. Zimbabwe has Africa’s highest interest rates and is second globally to Argentina, where the official rate is 133%.

The increase came after monthly consumer prices rose 4.5% in November, up from 2.5% in the previous month, breaching the central bank’s target of 3%. Food and utility price increases contributed the most to the increase, according to data from the national statistics agency.

“The MPC remained committed to pursuing a tight monetary policy stance to safeguard the prevailing macroeconomic stability and ensure that inflation expectations remained anchored in the short- to medium-term,” Governor John Mangudya said in the statement.

The southern African nation has been battling bouts of inflation in recent years that have eroded the pay of ordinary citizens and stoked volatility in its currency, the Zimbabwe dollar. The currency has lost 89% of its value against the US dollar this year and annual inflation topped 176% in June.

The cost of living in the southern African nation is seen soaring even further as the government plans to raise the price of everything from passports to road toll fees. A new 1% wealth tax is also planned on residential properties worth more than $100,000.

The Treasury expects annual consumer inflation to slow to between 10% and 20% next year, according to Finance Minister Mthuli Ncube, who last week presented the national budget to lawmakers.