Botswana’s central bank has announced a decision to maintain the country’s bank rate at 3.75 percent.
The announcement was made after the Bank of Botswana’s (BoB) Monetary Policy Committee (MPC) meeting which decided to continue with an accommodative monetary policy stance.
“The bank stands ready to respond appropriately as conditions dictate,” said BoB Governor Moses Pelaelo.
The MPC has projected that the economy will operate below full capacity in the short to medium term and not create any inflationary pressures, going forward.
“The projected increase in inflation in the short term is primarily due to transitory supply-side factors that, except for second-round effects, would not normally attract monetary policy response,” said Pelaelo. “This includes accommodative monetary conditions, improvements in water and electricity supply, reforms to further improve the business environment and government interventions against COVID-19, including vaccine rollouts, and the implementation of ERTP and Industry Support Facility.”
Meanwhile, Botswana’s annual inflation rate has risen above the central bank’s medium term target of 3 to 6 percent.
Statistics Botswana, the country’s data authority, on Tuesday announced that the country’s annual inflation rate rose to 6.2 percent in May 2021, up from 5.6 percent in April. Enditem