Interest rate stays put at 3.75%
The Bank of Namibia has decided to keep the Repo rate unchanged at 3.75%, joining various central banks who decided to maintain their policy interest rates.
Governor of the Bank of Namibia Johannes Gawaxab said the monetary policy committee is of the view that the rate remains appropriate to continue supporting domestic economic activity, while at the same time safeguarding the one-to-one link between the Namibia Dollar and the South African Rand.
“Domestic economic activity declined during the first ten months of 2020 and is estimated to register an overall contraction in 2020, before an expected modest recovery in 2021,” Gawaxab said.
Gawaxab said the contraction was mainly reflected in lower activity observed in mining, agriculture, manufacturing, tourism, wholesale and retail trade as well as transport and storage.
The domestic economy is estimated to contract by 7.3% in 2020 before returning to a moderate recovery of 2.6% in 2021.
Meanwhile, the country’s inflation remained low during the first ten months of 2020, declining to 2.2%, compared to 4% in the corresponding period of 2019.