WINDHOEK, Feb. 18 (Xinhua) -- The Bank of Namibia on Wednesday decided to keep the repo rate unchanged at 6.50 percent, citing the need to safeguard the one-to-one peg between the Namibia dollar and the South African rand while supporting domestic economic activity.
Speaking at the first monetary policy announcement for the year, Governor of the central bank Ebson Uanguta said the policy stance was taken to ensure orderly capital flows and maintain the currency peg arrangement.
Commercial banks are accordingly expected to maintain the prime lending rate at 10.00 percent, he added.
Overall growth for 2025 is now expected to be lower than earlier projected, Uanguta said, noting that economic growth slowed in the first three quarters of 2025, largely due to contractions in agriculture, fishing, mining and manufacturing sectors.
Inflation, however, remained well contained where average inflation fell to 3.5 percent in 2025, down from 4.2 percent in 2024, reaching a post-pandemic low.
The latest data show inflation slowed further to 2.9 percent in January 2026.
Average inflation for the whole year is projected to be at 3.5 percent, before easing slightly in 2027, according to Uanguta.
International reserves rose to 51.9 billion Namibian dollars (about 3.2 billion U.S. dollars) at the end of January, equivalent to 3.3 months of import cover, sufficient to support the currency peg and meet international financial obligations, the central bank said. ■