Bank of Namibia Holds Rates Steady as Inflation Outlook Adjusted

Bank of Namibia Holds Rates Steady as Inflation Outlook Adjusted. The Bank of Namibia has kept its benchmark repo rate unchanged at 6.50%, following a meeting of the Monetary Policy Committee (MPC) on Wednesday.

In its announcement, the central bank said the decision was taken after extensive deliberations, noting that maintaining the current rate would keep borrowing costs stable in the near term. As a result, commercial banks across Namibia are expected to retain their prime lending rates at 10.00%.

The MPC highlighted external risks as part of its assessment, pointing to escalating geopolitical tensions in the Middle East. The committee noted uncertainty around the duration of the conflict and the potential scale of its broader economic impact.

At the same time, the central bank referenced recent policy interventions aimed at shielding the domestic economy from rising energy costs. These measures, it said, could help moderate inflation pressures over the short term.

Looking ahead, the Bank of Namibia projected that inflation is likely to increase during the second quarter of 2026. The annual inflation rate is expected to average 3.7% for the year, before easing to 3.4% in 2027. The 2026 forecast represents an upward revision of 0.2 percentage points compared to previous estimates.

The revised outlook is based on assumptions of higher global oil and food prices, as well as continued currency volatility. These factors are expected to influence price levels across the economy in the coming months.

The MPC indicated that it would continue to monitor both domestic and international developments as part of its policy considerations. The central bank’s latest decision reflects a cautious approach as it balances inflation risks with the need to support economic stability.