The Bank of Namibia has cut its key interest rate by 25%. basis points, bringing it down to 6.50% from 6.75% previously, at the end of the meeting of its Monetary Policy Committee (CPM) held on Monday 13 and Tuesday October 14, 2025.

The annual growth in GDP has surprised us downwards, slowing to a post-pandemic level of 1.6% in the second quarter, against 2.8% in the previous quarter, largely due to the weak performances of the manufacturing, fishing and agricultural sectors.

Economic growth is now expected to weaken in 2025 compared to 3.7% recorded in 2024, with downside risks becoming more pronounced.

At the same time, inflation remains well contained, with an average of 3.6% in the first eight months of the year.

The inflation forecasts for 2025 and 2026 have were revised down by 0.2 percentage points to 3.6% and 4.0%, respectively, reflecting a stronger exchange rate assumption and outlook for lower oil prices.