The Bank of Botswana kept its benchmark rate steady at 5.5% on August 27, 2026, extending its pause in monetary policy after leaving rates unchanged in June. The decision keeps borrowing costs at their highest level since September 2017. The central bank judged that policy measures implemented so far had helped ease liquidity, improve policy transmission and stabilize the FX market. Policymakers said risks to the inflation outlook remained tilted to the upside, while the growth outlook remained exposed to downside risks. Botswana's annual inflation rate fell to 9.4% in July 2026 from 10.7% previously, but stayed persistently above the 3-6% medium-term objective range. The MPC expects inflation to remain above its target range through Q1 2027, mainly due to supply-side pressures from higher fuel prices, electricity tariffs and related cost-push effects. Inflation is projected to average 7.9% in 2026 before easing to 4.9% in 2027.