Monetary Policy Statement 3 December 2025
03 December 2025 | Media Release
REPO RATE MAINTAINED AT 6.50 PERCENT
On the 1st and 2nd of December 2025, the Monetary Policy Committee (MPC) of the Bank of Namibia held its final bi-monthly meeting of 2025 to decide on the appropriate monetary policy stance for the next two months, guided by incoming data and the assessment thereof. To continue safeguarding the peg between the Namibia Dollar and the South African Rand, while supporting the domestic economy, the MPC decided to keep the Repo rate unchanged at 6.50 percent.
RECENT ECONOMIC DEVELOPMENTS
The domestic economy grew moderately. Inflation has remained well contained, while
growth in Private Sector Credit Extension (PSCE) slowed since the previous MPC
meeting. The merchandise trade deficit narrowed, while the stock of international
reserves remains sufficient to maintain the currency peg and meet the country’s
international financial obligations.
1. High-frequency indicators in the domestic economy suggest that, while economic activity maintained positive growth, the pace of expansion slowed during the first ten months of 2025 compared to the same period in 2024. The slowdown was primarily driven by contractions in the manufacturing sector, diamond mining, livestock farming, and transport subsectors. Given the generally subdued economic activity so far in 2025, real GDP growth is now projected to slow from 3.7 percent in 2024 to 3.0 percent in 2025, 0.5 percentage point lower than the previous forecast.
2. Looking ahead, real GDP growth, however, is projected to recover to 3.8 percent in 2026 and further to 4.3 percent in 2027. This recovery is expected to be primarily underpinned by a rebound in the agriculture sector, a sustained upturn in construction, robust electricity generation and stronger output from the uranium subsector. Downside risks to the outlook remain and include the possibility of renewed drought conditions, infrastructure constraints, and sluggish global demand.