Central Bank maintains repo rate at 3.75%
The Bank of Namibia has decided to keep the Repo rate unchanged at 3.75% saying the rate remains appropriate to support the weak domestic economic that is still weighed down by the effects of the COVID-19 pandemic.
At this level, the repo rate is deemed appropriate to safeguard the one-to-one link between the Namibia Dollar and the South African Rand, while meeting the country’s international financial obligations.
A review of the GDP shows there has been improvement in the second quarter of 2021, while economic activity remained subdued year-to-date.
“The (GDP) increase was attributed to better growth in sectors such as hotels and restaurants, wholesale and retail trade, fishing, administrative and support services as well as information and communication during the second quarter of 2021,” Bank of Namibia Governor, Johannes !Gawaxab said.
He said economic indicators showed that the domestic economy slowed year-to-date relative to the corresponding period of 2020.
“The slowdown in economic activity was observed in major sectors such as mining, agriculture, manufacturing, construction, tourism as well as transport and storage. On the contrary, activities in the wholesale and retail trade sector, as well as the telecommunication sub-sector, increased during the review period,” !Gawaxab said.
Going forward, the domestic economy is expected to grow by 1.4% in 2021 and 3.4% in 2022.
“Risks to the domestic economic outlook in the near-term remain and include sudden surges in COVID-19 cases with concomitant disruptions to economic activity caused by potential COVID-19 restrictions,” the Governor added.
