Repo rate remains unchanged

06 Dec 2017 15:10pm
WINDHOEK, 06 DEC (NAMPA) – The Monetary Policy Committee (MPC) of the Bank of Namibia (BoN) left the repo rate unchanged at 6.75 per cent.
This was said by BoN Governor Ipumbu Shiimi during the sixth and last monetary policy announcement of the year on Wednesday.
“This level is deemed appropriate to continue supporting domestic economic growth, while maintaining the one-to-one link between the Namibian Dollar and South African Rand,” Shiimi said.
While the global economy is projected to grow by 3.6 per cent in 2017, from the 3.2 per cent in 2016, the domestic economy showed more evidence of weakness during the first ten months of 2017.
Additionally, inflation and growth in private sector credit extension (PSCE) continues to slow, while the stock of international reserves rose.
“Economic activity in key domestic sectors remained weak during the first ten months of 2017, relative to the corresponding period of 2016.”
According to Shiimi, the weak performance was mainly reflected in the construction, wholesale and retail trades as well as transport sectors.
Despite these recorded weaknesses however, Shiimi added that other key economic activities such as mining, agriculture, communication and the manufacturing output improved over the same period.
“The momentum displayed by the latter activities, if sustained, would create better prospects and help with economic recovery going forward,” Shiimi projected.
He elaborated that the projected growth in the global economy is attributed to improved investment, trade and industrial production, coupled with strengthening business and consumer confidence in the medium term.
Shiimi said economic activity in most of the monitored advanced economies improved in the third quarter of 2017, compared to the second quarter, mainly driven by the United States and the Euro area.
“Going forward, economic activities in the advanced economies as a whole is expected to improve with estimated growth of 2.2 per cent in 2017, compared to 1.7 per cent last year, supported by stronger investment and expansion in manufacturing and service activity.”