Botswana reduces monetary policy rate by 25 basis points

Source: The Star

GABORONE, Dec. 7 (Xinhua) -- Botswana reduced the country's monetary policy rate by 25 basis points from 2.65 percent to 2.4 percent, the country's central bank announced Thursday.

Cornelius Dekop, governor of the Bank of Botswana, said the current state of the economy and the outlook for both domestic and external economic activity provide scope to ease monetary policy.

Dekop highlighted that the central bank anticipates the economy to operate below full capacity in the short term and not generate demand-driven inflationary pressures.

"Inflation is forecast to remain within the objective range in the medium term, averaging 4.9 percent in 2024 and 4.7 percent in 2025," said Dekop.

The country's inflation decreased slightly from 3.2 percent in September to 3.1 percent in October 2023, remaining within the bank's medium-term objective range of 3 percent to 6 percent.

Dekop attributed the positive economic outlook to the growth-enhancing economic transformation reforms and supportive macroeconomic policies being implemented in the country.

"These include supportive monetary and fiscal policies, improvement in water and electricity supply, implementation of the Economic Recovery and Transformation Plan and the two-year Transitional National Development Plan, as well as reforms to further improve the business environment," said the governor.