Botswana Central Bank Holds Policy Rate Stable Amid Diamond Sector Weakness
Quidah is an online platform that connects investors with curated opportunities and expert insights on Africa’s emerging markets, while offering businesses promotional services, partnership facilitation, and market intelligence to attract capital and grow their operations.
Industries
The Bank of Botswana maintained its benchmark rate at 3.5% in its first policy meeting under Governor Lesego Moseki, citing economic activity below capacity and inflation within the 3–6% target range. Inflation rose to 3.9% year-on-year in October from 3.7% in September; the bank forecasts 2.7% average in 2025 and 5.3% in 2026.
Real GDP contracted 5.3% year-on-year in Q2 2025 after a 0.4% decline in Q2 2024, driven by a diamond sector downturn as global demand weakened. The October 160-basis-point hike addressed a liquidity squeeze from elevated market lending rates linked to the slowdown. The stance aims to support growth while keeping inflation within the 3–6% target range.
