Botswana Central Bank Cuts Policy Rate For Third Time

(RTTNews) - Botswana's central bank on Wednesday lowered its benchmark interest rate for the third time in a row to boost economic growth as inflation weakened.

The Bank of Botswana reduced its policy interest rate by 50 basis points to 8 percent at the latest meeting, marking the third cut in a row.

A statement from the bank said that the outlook for inflation remains positive, and is consistent with a more accommodative policy stance. Inflation is expected to remain within target for the reminder of the year.

Botswana's inflation weakened to 5.8 percent in June from 6.1 percent in May, moving inside the central bank's target range of 3-6 percent. The fall is attributable to both the dissipation of base effects arising from the increase in administered prices last year and a slowdown in the annual rate of price increase across a broad range of goods and services.

The economy expanded 3.6 percent in in the twelve months to March, slower than the 6 percent growth recorded in the corresponding period the previous year. The slowdown mainly reflected a marked fall in mining output and weaker domestic demand.

The bank noted that going ahead, the influence of demand on economic activity is expected to remain modest, largely reflecting trends in government expenditure and personal incomes.