Botswana central bank keeps monetary policy rate at 3.5 pct

GABORONE, Feb. 26 (Xinhua) -- The Bank of Botswana's Monetary Policy Committee on Thursday unanimously decided to keep the monetary policy rate at 3.5 percent.

Lesego Moseki, Botswana's central bank governor, announced the decision following the committee meeting in Gaborone, the country's capital.

Headline inflation increased slightly to 4.1 percent in January from 3.9 percent in December 2025, remaining within the medium-term objective range of 3 percent to 6 percent, the bank said in a statement.

The central bank warned that a planned electricity tariff hike in April could push inflation higher.

Inflation was forecast to increase into the medium term, averaging 4.5 percent in 2026 and 4.7 percent in 2027, it said.

The Botswanan Ministry of Finance projects an economic contraction of 0.4 percent in 2025, mainly due to the continued weak performance of the diamond mining sector. However, the economy is expected to recover in 2026, with a projected 3.1 percent growth. ■