WINDHOEK, Oct. 15 — The Bank of Namibia (BoN) has reduced its benchmark interest rate by 25 basis points to 6.50 percent to support a slowing domestic economy while maintaining currency stability, the central bank said on Wednesday.
“Domestic economic activity has weakened, while inflation remains contained,” BoN Governor Johannes Gawaxab told reporters in the capital, Windhoek.
Real gross domestic product growth fell to 1.6 percent in the second quarter of 2025, down from 3.3 percent in the same period last year, the lowest since the pandemic, mainly attributed to a weaker performance in the manufacturing, fishing and agriculture sectors, he added.
High-frequency indicators suggest that overall expansion during the first eight months of the year slowed compared with 2024, the bank said, adding that growth for 2025 is now expected to ease further from 3.7 percent recorded last year.
Inflation averaged 3.6 percent in the first eight months of 2025, compared with 4.6 percent over the same period in 2024, driven by lower housing and alcohol prices and transport deflation, it said.
The central bank lowered its inflation forecast for both 2025 and 2026 by 0.2 percentage points to 3.6 percent and 4.0 percent, respectively, due to a stronger exchange rate and a softer oil price outlook. (Xinhua)
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