Inflation surge reshapes monetary outlook
Namibia’s private sector credit extension (PSCE) data for April points to a mid-expansion phase in the credit cycle, with broad-based improvements in lending activity but rising inflation now emerging as the dominant macroeconomic risk, according to Almandro Jansen of Simonis Storm.
Staff Writer Namibia’s private sector credit extension (PSCE) data for April points to a mid-expansion phase in the credit cycle, with broad-based improvements in lending activity but rising inflation now emerging as the dominant macroeconomic risk, according to Almandro Jansen of Simonis Storm. At the same time, inflation has emerged as a key macroeconomic pressure point. Headline inflation jumped to 3.1% in April from 2.1% in March, marking the sharpest monthly acceleration in the post-pandemic period.
The increase was primarily driven by transport costs, which reversed from a 1.7% decline to a 5.0% increase, reflecting lagged pass-through effects from currency depreciation and higher global fuel prices. As a result, Namibia’s inflation gap with South Africa narrowed to 90 basis points. The inflation spike has significant implications for real interest rates.
