Monetary policy is determined by the regional central bank, Banque des Etats de l'Afrique centrale (BEAC), which prioritises the control of inflation and the maintenance of the CFA franc's peg to the euro. Concerns about the fiscal sustainability and coherence of the euro area are set to persist into 2011 and the European Central Bank (ECB) is expected to maintain low interest rates over the forecast period. The BEAC rarely makes changes to the policy rate, as it has only a small effect on liquidity levels given the lack of depth in regional financial markets. Consequently, we expect the BEAC broadly to track the ECB and maintain its main policy rate, taux des appels d'offres, at 4% in 2011 and to raise it by 50 basis points towards the end of 2012.