Yesterday, the Pula was valued at P8.66 to the Dollar and P0.86 to the Rand according to Bank of Botswana opening rates, compared to P8.65 to the Dollar and P0.85 to the Rand on Friday.Barclays Bank Botswana was quoting the greenback at P9.15 for cash sale before commission yesterday, while First National Bank Botswana was quoting P8.89 before commission on Friday.
Experts have said the latest trends reflect the downtrend in the South African currency, itself weighed down by fears of a wage-price spiral triggered by mining sector labour unrest. In addition, a general strengthening of the US Dollar has seen it gain against both the Pula and the Rand in recent months.Econsult economist, Thabelo Nemaorani has said the current trends in the Pula values against the Rand and the greenback had been noted from the middle of last year. "The latest trends are positive for rough diamond exports which are priced in US Dollars, but there is another angle," he told Mmegi Business. "The loans Botswana received from the African Development Bank were in USD ($1.5 billion) and when the Pula weakens against that currency, government's repayments rise. Thus, the country's indebtedness increases but on the other hand, revenues received from diamond exports increase. Another angle is that most of our imports are from South Africa and a weaker Rand versus the Pula is positive in that imported inflation will be restrained," he explained.
