The Monetary Policy Committee of the Bank of Namibia raised the repo rate by 25 basis points to 6.75% in June 2026, saying a moderate tightening was appropriate to mitigate inflationary risks, support international reserves and safeguard the one-to-one link between the Namibia Dollar and the South African Rand amid rising global and domestic price pressures and subdued domestic activity. The move lifts the prime lending rate to 10.25%. Domestically, economic activity remained weak in the first four months of 2026, while growth is projected to recover to 2.6% in 2026 from 1.7% in 2025; headline inflation accelerated to 4.1% in May from 2.1% in March and is now forecast at 4.0% in 2026 before easing to 3.6% in 2027, with risks tilted to the upside, while private sector credit extension growth remained subdued at 4.8% year on year in April. On the external side, the merchandise trade deficit widened to N$11.7 billion in the first four months of 2026, but international reserves increased to N$55.4 billion at end-May, equivalent to 3.5 months of import cover, which the central bank said was sufficient to support the peg and meet international financial obligations. The MPC cited elevated global uncertainty, mixed growth, higher inflation across monitored economies, tighter policy by some key central banks and oil prices that, despite retreating to about USD79 a barrel, could remain above pre-war levels and keep pressure on domestic inflation. The Bank of Namibia said it will close
Bank of Namibia2026-06-17
Bank of Namibia raises repo rate by 25 basis points to 6.75% in June 2026
The Monetary Policy Committee of the Bank of Namibia raised the repo rate by 25 basis points to 6.75% in June 2026, lifting the prime lending rate to 10.25%, saying moderate tightening was needed to mitigate inflation risks, support international reserves and safeguard the one-to-one link between the Namibia Dollar and the South African Rand. The move comes as headline inflation accelerated to 4.1% in May and is forecast at 4.0% in 2026, while reserves rose to NAD55.4 billion at end-May, equivalent to 3.5 months of import cover, despite weak domestic activity and a wider merchandise trade deficit.