Costa Rica lowers reserve requirements on domestic currency
Move follows IMF recommendation to boost domestic currency use in highly dollarised economy
The Central Bank of Costa Rica is set to lower reserve requirements in an effort to boost credit growth and promote de-dollarisation.
The monetary board agreed to reduce the requirement rate by three percentage points to 12% on the deposits that banks must maintain at the central bank. The adjustment will take effect on June 16.
The central bank has not adjusted the reserve requirement since 2005, and has not reduced it since 2002. The move also follows two interest rate cuts in March and May
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