Namibia: Bank of Namibia raises repo rate to 7.00% on 28 October 2026

The Bank of Namibia raised its main interest rate on 28 October 2026, lifting the repo rate by 25 basis points from 6.75% to 7.00%. The Monetary Policy Committee took the decision unanimously at its meeting on 26 and 27 October, and the move takes the prime lending rate to 10.50%, according to Namibian press reports of the announcement.

Why the bank raised the rate

The immediate reason is inflation. Annual inflation reached 5.4% in September 2026, its highest level since January 2024, after 5% in August and 3.5% in September 2025, with prices rising 0.3% in September alone. Transport costs did much of the damage as fuel prices stayed high.

Governor Ebson Uanguta said the policy stance was appropriate to safeguard the one-to-one link between the Namibia dollar and the South African rand and to limit second-round effects from high fuel prices. In plain terms, that is the risk that dearer fuel feeds into the prices of other goods and services. The bank also wanted to narrow the interest rate gap with South Africa, whose central bank raised rates last month, in order to stem capital outflows and protect its stock of international reserves.

What it means for borrowers and savers

The change reaches households through the prime rate. Borrowers with variable-rate home loans, vehicle finance and other credit linked to the prime rate face higher monthly repayments when banks pass the move on, while loans on a fixed rate do not change until the fixed period ends. On the savings side, deposit rates tend to move in the same direction as the policy rate over time, but each bank sets its own rates, so the effect is not automatic or uniform.

What happens next

The bank raised its inflation forecasts alongside the decision, expecting average inflation of 4.2% in 2026 and 4.0% in 2027. It kept its growth outlook unchanged, projecting expansion of 2.1% in 2026 and 2.8% in 2027. Economists at Nedbank forecast another 25 basis point rise later this year, with a possible further increase in the first quarter of next year, as the fuel price shock spreads to broader price pressures. The committee meets again on 7 and 8 December 2026.