Headline inflation in Botswana edged up slightly from 1.5% in September to 1.6% in October 2024, according to the Bank of Botswana (BoB). This figure remains below the lower bound of the Bank’s medium-term target range of 3% to 6%.
Speaking at a recent Monetary Policy Committee (MPC) meeting, BoB Governor Mr. Cornelius Dekop attributed the slight increase to a general rise in food prices.
Inflation Projections
The MPC forecasts inflation to remain relatively low in the medium term, with projected averages of:
• 2.9% in 2024
• 3.3% in 2025
• 4.9% in 2026
Potential Downward Risks
Governor Dekop noted that inflation could fall below these projections due to several factors, including:
• Subdued domestic and global economic activity.
• Limited fiscal capacity.
• The possibility of a further decline in international oil prices beyond current estimates.
“The MPC observes that these factors may contribute to lower-than-expected inflation levels,” Mr. Dekop explained.
Policy Implications
The Bank of Botswana remains committed to monitoring economic developments to ensure inflation stays within the medium-term objective range, balancing growth and price stability.
