Wednesday, December 9, 2015

Namibia holds rate as installment credit trends downward

   Namibia's central bank left its benchmark repo rate steady at 6.50 percent, citing "the recent downward trend in the growth of installment credit extended to households and the need to continue supporting the domestic economy."
    The Bank of Namibia, which has raised its rate by 50 basis points this year, said annual growth in installment credit to households eased to 14.7 percent at the end of October from a peak of 23.5 percent at the end of February, a development that "pleased" its Monetary Policy Committee.
    But domestic demand as reflected in private sector credit extension (PSCE), maintained a steady annual growth of 15.6 percent in the first 10 months of this year from last year, mainly due to strong growth in credit to the corporate sector.
    Namibia's economy also continued to expand in the first three quarters of the year due to robust construction activities in the public and private sectors while the mining sector remained weak.
     Inflation continued to decline on average, with the annual rate in the first 10 months down to 3.4 percent from 5.5 percent in the same 2014 period, mainly due to lower transport inflation from lower oil prices along with using and food inflation.
    In October the inflation rate rose slightly to 3.4 percent from 3.28 percent in September.
    The central bank added the stock of international reserves was sufficient to sustain the 1-1 link of the Namibian dollar to South Africa's rand, rising to about N$23 billion as of Dec. 3, primarily due to the issuance of a Eurobond and receipts from the South African Customs Union (SACU).


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