Botswana inflation jumps

AFTER EASING temporarily in April to 6.6% from 6.9% in March, overall inflation in Botswana jumped to 7.4% in May.
“As expected,” said Standard Bank analyst, Henry Flint, “the Botswana Housing Corporation (BHC) rental increase - which came into affect on May 1 - caused inflation to accelerate sharply.
“While unnerving, the sharp jump in inflation is expected to be temporary and inflation should fall back to below the adjusted upper target point of 7% this month (June) - barring any unforeseen price shocks.”
However, Flint warned, oil price uncertainty will continue to cloud the outlook for interest rates.
“While the Bank of Botswana is expected to hold back on interest rate increases for now,” he told FTW, “the situation may be different towards the end of the year - when inflation will be higher and interest rates are hiked in SA.”