BoN maintains repo rate during high inflation

12 Apr 2017 14:40pm
WINDHOEK, 12 APR (NAMPA) – The Bank of Namibia (BoN) has decided to keep the repo rate unchanged at seven per cent.
Speaking at the second Monetary Policy announcement for 2017 on Wednesday, BoN Governor Ipumbu Shiimi said the repo rate at this level remains appropriate to support and maintain the one-to-one link between the Namibian Dollar and South African Rand.
Shiimi said inflation remained high in the first two months of 2017, increasing from an average of 6,7 per cent in 2016 to 8,2 per cent in January 2017, before slowing to 7,8 per cent in February this year.
“The high levels in 2017 were mainly driven by the rise in the inflation rates for major categories such as housing, water, electricity, gas and other fuels transport as well as food,” he said.
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 mostly likely to affect the interest rate that commercial banks charge consumers.