BoN keeps the repo rate unchanged at 7.75%

After hiking the repo rate by 100 basis points (bps) thus far in 2023, the Bank of Namibia (BoN) at the fourth monetary policy announcement decided to keep the repo rate at 7.75%. That means the prime lending rates for local commercial banks will also remain at 11.50%.Similarly, the South African Reserve Bank (SARB) also left the repo rate unchanged at 8.25% at the fourth monetary policy announcement in June. That leaves Namibia 50 basis points behind. According to the governor of the central bank Johannes !Gawaxab, the differential in the repo rate poses a risk of capital outflow from Namibia to South Africa because of high returns on investments in the neighboring country.However, the decision to keep the repo rate unchanged was partly taken to support the domestic economy.According to the Namibia Statistics Agency (NSA), the Namibia economy grew by 4.6% in 2022. During the first quarter of 2023, the domestic economy expanded by 5%. The central bank has now revised the economic growth forecast upwards to 3.3%, compared 3% projected at the previous monetary policy announcement.Looking at inflation, Namibia recorded a rate of 4.5% in July. Between January and July, inflation averaged 6.2%. The Bank of Namibia now projects inflation to average 5.3 % in 2023, a downward revision from 6.1% projected at the previous monetary policy announcement.In South Africa, annual consumer price inflation slowed to 5.4% in June from 6.3% in May, according to Stats SA. Inflation averaged 6.6% in the first half (January to June) of 2023. According to Simonis Storm, the market in South Africa is forecasting July’s inflation print to come in between 4.5% and 5.0%. Fin24 reported that the South African Reserve Bank’s monetary policy committee prefers to anchor inflation expectations close to the 4.5% midpoint of its target range of 3%-6%.South Africa’s next monetary policy announcement is expected to take place on 21 September, while the fifth announcement by the Bank of Namibia is expected to take place on 25 October.- phillep@nmh.com.na

BoN keeps the repo rate unchanged at 7.75%

Comments

Namibian Sun 2026-11-05

Please login to leave a comment

BoN keeps the repo rate unchanged at 7.75%

Comments

Namibian Sun 2026-11-05

Please login to leave a comment

Subscription Required to Access Content ×

Login

Subscription Required to Access Content