Repo rate increased by 25 basis points to 7%
The central bank, the Bank of Namibia this week increased the repo rate by 25 basis points to 7% with immediate effect.
Governor of Bank of Namibia, Johannes !Gawaxab on Wednesday at the Monetary Policy Committee (MPC) announcement said the decision was taken following a comprehensive review of global, regional, and domestic economic developments.
The increase in the repo rate effectively brings the prime lending rate to 10.75%,” he said adding that the decision is further set to contain inflationary pressure and its second-round effects and anchor inflation expectations.
Furthermore, he said the decision is also deemed appropriate to safeguard the one-to-one link between the Namibia Dollar and the South African Rand.
“Moreover, this monetary policy stance will take the current negative real policy interest rate to a neutral rate.”
Meanwhile, !Gawaxab said the overall inflation for 2023, however, is expected to decline to an average of 5.3%. “This is an upward revision from the 4.9% forecast at the last MPC,” he concluded.