Repo rate remains unchanged

The Bank of Namibia (BoN) has kept the repo rate unchanged at 6.50 per cent.

Speaking at a media conference here on Wednesday, BoN Governor Ipumbu Shiimi said the Monetary Policy Committee (MPC) made the decision in order to continue supporting domestic economic activities and to maintain the one-to-one link between the Namibian Dollar and the South African Rand.

The repo rate is the cost at which the central bank lends money to commercial banks and an increase or decrease in that rate is most likely to affect the interest rate that commercial banks charge consumers.

He noted that the global economic growth slowed during the second quarter of 2019, while inflation rate in the key Advanced Economies (AEs) remained low, while increasing slightly in a number of Emerging Market and Developing Economics (EMDEs).

Global economic growth slowed during the second quarter of 2019, mainly due to lower growth observed in the AEs, he noted.

Shiimi further indicated that going forward growth in the global economy is projected to slow down further to 3.0 per cent in 2019 before recovering to 3.4 per cent in 2020.

He added that the lower growth of most AEs was evident in the United States, Euro area and the United Kingdom while as for Japan the growth rate improved.

The Governor assured that the AEs growth rate is projected to slow down to 1.7 per cent for 2019 compared to 2.3 per cent recorded in 2018.

In addition, he noted that the Gross Domestic Product (GDP) growth for the EMDEs is projected to be lower at 3.9 per cent for 2019 from 4.5 per cent in 2018.

Key risks to the global outlook remain, amongst others unresolved trade and geopolitical tensions as well as Brexit, he said.

Source: Namibia Press Agency