Central Bank maintains repo rate at 6.75%
Following a review of global, regional and domestic economic and financial developments, the Bank of Namibia’s monetary policy committee decided to maintain the repo rate unchanged at 6.75% on Wednesday.
The central bank said since the previous monetary policy committee meeting in October, most central banks in both the Advanced Economies and Emerging Market and Developing Economies left their policy rates unchanged at their most recent monetary policy committee meetings. The exception was the South African Reserve Bank, which raised its repo rate in November 2018
According to the central bank governor, Ipumbu Shiimi, the domestic economic activity remained weak during the first ten months of 2018, although some sectors showed signs of improvement.
“Activity in sectors such as agriculture and wholesale and retail trade continued to decline, although there were notable improvements in sectors such as mining, transport and communication as well as manufacturing. The domestic economy is expected to remain weak for 2018 as a whole,” Shiimi said.
Furthermore, Shiimi noted that overall inflation is estimated to average around 4.3% in 2018 and projected at 5.4% for 2019.
Meanwhile, the Bank of Namibia announced that as at 31 October, the stock of international reserves stood at N$31.1 billion, from N$32.5 billion reported in the previous monetary policy committee statement.
“This level of international reserves is estimated to cover 4.2 months of imports of goods and services. At this level, the reserves are sufficient to protect the peg of the Namibia Dollar to the Rand, as well as meeting the country’s international financial obligations,” Shiimi added.
The next monetary policy committee meeting will be held on 12 February 2019.