Inflation seen inching higher

Tuesday, August 26, 2025 | 150 Views |

HEATING UP: Inflation is expected to speed up this year and into 2026 due to the market reaction from the Pula exchange rate framework adjustments. PIC MORERI SEJAKGOMO

The Bank of Botswana now expects inflation to average 3.5 percent this year, from a June projection of 2.7 percent, due to the acceleration of prices following recent changes to the pula exchange rate framework.

The central bank now expects inflation next year to average 5.9 percent, up from the 4.6 percent forecast in June.

Speaking at a briefing held after the August Monetary Policy Committee meeting last week, BoB governor, Cornelius Dekop, said the inflation outlook had changed significantly due to both exchange rate and retail price increases associated with the July 11 adjustment of the pula exchange rate framework.

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