Tight financial conditions for indebted Namibians
As rates are expected to rise further
Growth in private sector credit extension slowed to 4.1% at the end of September 2022, from 4.6% in August 2022.
Tight financial conditions for indebted Namibian households and corporates lie ahead as rate hikes are expected to rise further towards the end of this year and during first quarter of 2023, Simonis Storm said.
The central bank recently announced a 75 basis points increase in the repo rate from 5.50% to 6.25%, bringing it on par South Africa. The prime lending rate in South Africa stands at 9.75% and 10% in Namibia.
Year to date, the rate at which commercial banks borrow from the central bank increased by 250 basis points in Namibia and South Africa. Both countries have one monetary policy announcement left for the year 2022.
According to Simonis Storm vehicle sales report, some local dealerships still indicate that a large share of customers are seeing their car loan applications rejected.
Fin24 recently reported that the rate hikes by the South African Reserve Bank (SARB) have had a big impact on first-time homebuyers.
According to the Bank of Namibia (BoN) money and banking statistics, credit uptake by the private sector slowed to 4.1% at the end of September 2022, from 4.6% in August 2022.
Growth in credit extended to businesses slowed to 5.9% at the end of September 2022, relative to a growth rate of 8.2% in August 2022. The decrease reflects a decline in most of the credit categories driven by reduced demand and repayments by corporates in the construction and services sector during the period under review, BoN pointed out.
In addition, growth in credit extended to households rose to 2.8% year-on-year at the end of September 2022, compared to a growth rate of 2.0% reported at the end of the previous month. The increase was more evident in mortgage credit and other loans and advances during the period under review, the central bank added.
Looking at price developments, Namibia’s annual inflation rate slowed to 7.1% in September 2022, compared 7.3% recorded in August 2022. The decrease in inflation was mainly attributed to a decrease in the category transport inflation.
Yesterday, the ministry of mines and energy announced that petrol prices will be kept unchanged, while diesel prices with increase by N$1.98 cents per litre, effective 02 November 2022.
Petrol prices at Walvis Bay will therefore remain unchanged at N$20.08, with diesel prices increasing to N$24.10 per [email protected]
The central bank recently announced a 75 basis points increase in the repo rate from 5.50% to 6.25%, bringing it on par South Africa. The prime lending rate in South Africa stands at 9.75% and 10% in Namibia.
Year to date, the rate at which commercial banks borrow from the central bank increased by 250 basis points in Namibia and South Africa. Both countries have one monetary policy announcement left for the year 2022.
According to Simonis Storm vehicle sales report, some local dealerships still indicate that a large share of customers are seeing their car loan applications rejected.
Fin24 recently reported that the rate hikes by the South African Reserve Bank (SARB) have had a big impact on first-time homebuyers.
According to the Bank of Namibia (BoN) money and banking statistics, credit uptake by the private sector slowed to 4.1% at the end of September 2022, from 4.6% in August 2022.
Growth in credit extended to businesses slowed to 5.9% at the end of September 2022, relative to a growth rate of 8.2% in August 2022. The decrease reflects a decline in most of the credit categories driven by reduced demand and repayments by corporates in the construction and services sector during the period under review, BoN pointed out.
In addition, growth in credit extended to households rose to 2.8% year-on-year at the end of September 2022, compared to a growth rate of 2.0% reported at the end of the previous month. The increase was more evident in mortgage credit and other loans and advances during the period under review, the central bank added.
Looking at price developments, Namibia’s annual inflation rate slowed to 7.1% in September 2022, compared 7.3% recorded in August 2022. The decrease in inflation was mainly attributed to a decrease in the category transport inflation.
Yesterday, the ministry of mines and energy announced that petrol prices will be kept unchanged, while diesel prices with increase by N$1.98 cents per litre, effective 02 November 2022.
Petrol prices at Walvis Bay will therefore remain unchanged at N$20.08, with diesel prices increasing to N$24.10 per [email protected]
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