By Nyasha Nyaungwa
WINDHOEK (Reuters) -Namibia’s central financial institution lower its most important rate of interest for the second assembly in a row on Wednesday, saying inflation had fallen surprisingly rapidly and that the economic system wanted extra assist.
Its Financial Coverage Committee (MPC) unanimously determined to chop the repo charge by 25 foundation factors to 7.25%, the identical measurement of lower as at August’s assembly.
“The MPC famous the rising momentum within the worldwide financial coverage easing cycle, the retreat in home inflation over the medium time period, together with the latest draw back shock within the September 2024 inflation print,” Financial institution of Namibia Governor Johannes !Gawaxab stated in an announcement accompanying the choice.
Annual inflation within the southern African nation fell to three.4% in September , a steep drop from the 4.4% posted in August.
The central financial institution on Wednesday revised down its common inflation forecast for this yr to 4.3%, versus a 4.7% forecast given at its final assembly.
It attributed the revision to a extra beneficial outlook for worldwide oil costs and a stronger home change charge.
The financial institution stated personal sector credit score extension remained subdued, suggesting that additional assist to the home economic system was warranted.
“The home economic system, whereas rising at a reasonable tempo, was working under full capability,” !Gawaxab stated.
Progress is projected to sluggish to three.1% in 2024, in comparison with 4.2% in 2023.
On a $750 million Eurobond redemption due in late 2025, the central financial institution governor stated Namibia had already put aside 82% of the $500 million it needs to retire at maturity. The federal government nonetheless hopes to refinance the remaining $250 million, !Gawaxab stated.
