Rwanda's Partial Fisher Effect Could Lead to Decrease in Household Savings.
The Fisher effect was examined in Rwanda from 2012 to 2020. The study found that changes in expected inflation did not fully affect nominal interest rates, leading to a partial Fisher effect. This suggests that bank deposits may decrease over time, impacting household savings rates. The research also showed that in the short term, there was no direct link between nominal interest rates and expected inflation, highlighting potential challenges in using interest rates for monetary policy.