Repo rate kept unchanged at 3.75%
In line with market expectation, the Bank of Namibia Governor Johannes !Gawaxab on Wednesday, 16 June announced the repo rate will stay put at 3.75%, following the conclusion of the bank’s Monetary Policy Committee (MPC) meeting on Tuesday, 15 June.
The decision by the MPC was made to continue supporting domestic economic activity, particularly in light of the alarming increase in COVID-19 infections and hospitalisation, while at the same time safeguarding the one-to-one link between the Namibia Dollar and the South African Rand.
“Since the last MPC meeting, uncertainties and risks have increased and are likely to impact the economy negatively going forward. Hence, the successful procurement and expeditious rollout of COVID-19 vaccines in Namibia remain key to the extent and speed of the economic recovery,” !Gawaxab said.
The increase in food and housing inflation has seen annual average inflation increase to 3.2% during the first five months of 2021, compared to 2.1% for the corresponding period in the previous year.
“This was on account of supply constraints particularly for meat, coupled with the influence of base effects in the rental payments for dwelling subcategory, respectively,” the Governor said.
Meanwhile, the country’s international reserves stood at N$39 billion as at 31 May, partly due to an inflow from the IMF in the form of a disbursement of IMF Rapid Financing Instrument (RFI) and SACU receipts. This is an increase from the N$34.7 billion seen at 31 March.