CHAMWE KAIRA
The stock of international reserves held by the Bank of Namibia increased in October by 6.6%, reaching N$60.9 billion.
SACU inflows primarily drove the monthly increase in reserves.
Relative to the international benchmark of three months, the current level of foreign reserves represents 4.1 months of import cover.
Notably, the import cover, excluding imports of oil exploration and appraisal activities, stood at 4.9 months in October, compared to 4.6 months in September.
The overall liquidity level of the banking industry averaged N$6.7 billion in October, higher than the N$5.9 billion recorded in September.
The rise in market cash balances was primarily attributed to cash inflows from coupon payments, diamond sales, and the GC24 redemption, the central bank said.
Annual growth in business credit increased in October to 4.4%, from 3.3% in the previous month.
“The surge in growth was driven by improved demand for credit from companies in the manufacturing, real estate, and tourist sectors, which was evident across all credit categories,” the central bank said.
Yearly growth in private sector credit increased in October to 3.4%, from 3% recorded in September.
Businesses’ increased use of credit drove this increase in PSCE growth, while household credit slowed.
Annual growth in broad money supply increased to 11.5% in October from 9.8% in September.
“An increase in the Depository Corporations’ Net Foreign Assets, particularly the central bank’s, was the reason for the M2 growth. All components of M2: currency outside depository corporations, transferable, and other deposits, also saw increases, which bolstered the growth,” the central bank said.
Yearly growth in private sector credit increased to 3.4% in October, from 3% recorded in September.
The central bank said this increase in PSCE growth was driven by a higher uptake of credit by businesses, while credit to households slowed.
The central bank growth in household credit moderated to 2.7% in October, relative to 2.9% recorded in September.
“Contributing to this moderation are the categories of other loans and advances and overdrafts, which registered a decline during the period under review. On the positive side, growth in mortgage credit showed slight improvement, while installment sales and leasing credit recorded robust growth during the review period. This robust growth can be partially attributed to tax and interest rate relief measures,” the central bank said.
