GABORONE (Reuters) -Botswana’s central bank kept its monetary policy rate unchanged at 1.90% on Thursday, marking the sixth consecutive monetary policy meeting with no changes to the lending rate as it seeks to support a weaker domestic economy.
Inflation in the Southern African country fell to 1.1% year-on-year in July, from 2.0% in June, remaining well below the central bank’s preferred range of 3%-6%.
In an effort to boost economic competitiveness, the government announced last month that it would allow its pula currency to depreciate by 2.76% over the next year, at a faster pace than the previously announced 1.51% in December.
The country hopes a weaker currency will make local goods and services more competitive, reduce demand for foreign exchange, and help preserve the country’s foreign currency reserves.
Another review of the pula’s exchange rate policy is scheduled for the end of the year.
(Reporting by Brian Benza;Additional reporting by Anathi Madubela;Writing by Sfundo Parakozov;Editing by Olivia Kumwenda-Mtambo)
