Annual inflation rate stands at a firm 6%, while the repo rate remains unchanged at a steady 7.75%
The annual inflation rate averaged 6% during the first ten months of 2023, slightly up from 5.9% during the corresponding period in 2022.
The increase in consumer price inflation was primarily shaped by the rise in the food, housing, and miscellaneous goods and services components, the central bank said in the latest Monetary Policy Committee (MPC) announcement on Wednesday.
According to the Bank of Namibia, the average inflation is, however, expected to steadily decline to 5.9% in 2023 and 4.8% in 2024, from 6.1% recorded in 2022.
“This forecast remains unchanged relative to the projection at the previous MPC meeting,” the bank said.
Meanwhile, since the last MPC meeting, inflationary pressures eased in most of the monitored
economies.
Against this background, the MPC decided to keep the repo rate unchanged at 7.75%. As such, the prime lending rate remains steady at 11.50%.
The MPC noted the most recent short-term acceleration in inflation. However, with real interest rates already positive, continued signs of slack in the economy, slow credit growth, a projected slowdown in inflation in 2024, and a fair level of international reserves, the MPC decided to maintain the Repo rate at its current level.
“This policy stance will continue to safeguard the one-to-one link between the Namibia Dollar and the South African Rand and support domestic economic activity,” the central bank concluded.
