Market Elasticity Should Absorb Interest Rate Increases - FNBB

Speaking at the presentation of his bank's financial results for the year ended 30 June 2008, Zandamela said the elasticity of the domestic market to changes in interest rates was high and therefore very little, if any, effect on their business was anticipated.

"The local market is quite resistant in terms of reacting to interest rate increases," he said, "and Botswana has a long history of high interest rates."
In reaction to rising inflation, BoB increased the bank rate by 0.5 percent twice in as many months as, May and June.