Annual inflation recorded at 4.7% in August

Analysts see the rising Brent crude prices, coupled with the strong US dollar, as the biggest upside risk to inflation.According to IJG Securities, the OPEC alliance has been restricting supply in order to support oil prices, especially in light of weak demand indicators from China, a major consumer of oil.The ministry of mines and energy last week announced an increase in petrol prices for ULP95 by N$1.20, while diesel prices for both 50ppm and 10ppm rose by N$1.70. Namibia is a price taker in the international oil market, and actions or decisions that emanate from the supply forces have a significant impact on local fuel prices, the ministry said.According to Simonis Storm, higher transport costs possess the potential to elevate the costs of goods, given their significant influence on input costs. Industries involving transport, mining, agriculture, fishing, retail, wholesale, tourism, tour operators, and manufacturing are anticipated to experience heightened cost pressures as a consequence of elevated fuel prices.According to the Namibia Statistics Agency (NSA), July recorded a 17.8% increase in the import bill to N$11.9 billion from N$10.1 billion registered in June.Petroleum oils topped the list of imported goods in July, with a share of 15.3% of the total import value.Annual inflation rate stood at 4.7% in August, marking a 2.6 percentage point decline compared to the 7.3% recorded in August 2022. In July, inflation stood at 4.5%. The Bank of Namibia (BoN) projects inflation to average 5.3% in 2023. Interest rates IJG Securities noted that inflation expectations in South Africa declined for the first time in two years in the third quarter, suggesting price pressures have peaked and strengthens the argument that the South African Reserve Bank (SARB) and by extension the Bank of Namibia could leave rates unchanged at their next monetary policy committee (MPC) meetings.Meanwhile, Simonis Storm pointed out that at the previous MPC meeting, one member advocated for a 25 basis points increase in the repo rate, citing concerns about the uncertain path of inflation.This scenario might sway additional MPC members to consider a repo rate hike of 25bps at the upcoming meeting on the 25th of October. SARB’s fifth monetary policy announcement for the year is expected to take place on 21 September.The repo rate differential between Namibia and South Africa is 50 basis points. South Africa’s repo rate currently stands at 8.25%, while Namibia’s repo rate was kept unchanged at 7.75% at the previous monetary policy announcement.-phillep@nmh.com.na

Annual inflation recorded at 4.7% in August

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Namibian Sun 2026-10-16

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Annual inflation recorded at 4.7% in August

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Namibian Sun 2026-10-16

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