The Bank of Namibia (BoN) announced a 25 basis points increase in the repo rate from 7% to 7.25%. The means the prime lending rates for local commercial banks will increase from 10.75% to 11%.

The decision was taken to contain inflationary pressures, stem their second round effects and anchor inflation expectations, BoN governor Johannes !Gawaxab said.

He added: “The decision is also deemed appropriate to safeguard the one-to one link between the Namibia dollar and the South African rand. Moreover, this monetary policy stance will take the current negative real policy interest rate to a positive rate. The increase in the rate is nevertheless of moderate proportion to support the domestic economic recovery.”

[Source – Republikein]

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