Botswana’s annual inflation rate held steady at 10.7 percent in June, remaining at its highest level in more than two years as transport costs continued to drive consumer prices, official data showed on Wednesday.
The unchanged reading follows a sharp jump in April and keeps inflation well above the Bank of Botswana’s medium-term objective range of 3 percent to 6 percent, posing a challenge for policymakers seeking to contain price pressures while supporting an economy recovering from two years of contraction.
Statistics Botswana said the consumer price index (CPI) rose 0.2 percent from May, with transport accounting for 7.3 percentage points of the headline inflation rate. Miscellaneous goods and services contributed 1.2 percentage points, while food and non-alcoholic beverages added 0.9 percentage points. Housing, water, electricity and other fuels made a marginal negative contribution to overall inflation.
Imported goods continued to be the main source of inflationary pressure. Annual inflation for imported tradeables eased slightly to 17.9 percent from 18.1 percent in May, while domestic tradeables accelerated to 7.9 percent from 7.6 percent. Inflation for non-tradeable goods, which reflects domestic price pressures, was unchanged at 3.9 percent.
Among individual categories, clothing and footwear prices increased 0.6 percent during the month, while restaurants and hotels rose 0.5 percent. Health services, alcoholic beverages and tobacco, and miscellaneous goods and services each recorded monthly increases of 0.4 percent.
Core inflation indicators were mixed. Trimmed mean inflation eased marginally to 9.0 percent from 9.1 percent in May, while inflation excluding administered prices held at 5.9 percent.
Regionally, annual inflation remained highest in rural villages at 12.1 percent, compared with 10.4 percent in urban villages and 10.2 percent in cities and towns.