Headline inflation was unchanged for the third consecutive month at 2.2 percent in December 2020, remaining below the lower bound of the Bank’s medium-term objective range of 3 – 6 percent, but the same as in December 2019. According to Statistics Botswana, the constant inflation between November and December 2020 mainly reflects offsetting movements in the annual price changes for most categories of goods and services. Inflation increased for: Recreation and Culture (from 0.5 to 0.9 percent); Clothing and Footwear (from 2.6 to 2.8 percent); Housing, Water, Electricity, Gas and Other Fuels (from 6.8 to 6.9 percent); Health (from 1.5 to 1.6 percent); Transport (from -2.6 to -2.5 percent); and Miscellaneous Goods and Services (from 0.9 to 1 percent). However, the upward pressure on inflation was partly offset by inflation decreasing for: Food and Non-alcoholic Beverages (from 4.3 to 3.6 percent); Restaurants and Hotels (from 3 to 2.3 percent); Alcoholic Beverages and Tobacco (from 6.6 to 6.5 percent); Furnishing, Household Equipment and Routine Maintenance (from 2.1 to 2 percent); and Communication (from 0.9 to 0.8 percent). Inflation remained stable for Education (4.7 percent).

The 16 percent trimmed mean inflation and inflation excluding administered prices decreased slightly from 2.2 percent and 3.4 percent to 2.1 percent and 3.3 percent, respectively, between November and December 2020.