Namibia’s Inflation Rate is expected to rise towards the 4.5% to 5.0% range during the second half of 2026 as higher fuel prices, transport costs and utility tariffs increasingly filter through the broader economy, according to Simonis Storm economist Almandro Jansen.
This comes as Headline Inflation accelerated to 3.1% year-on-year in April from 2.1% in March, marking the sharpest monthly increase in more than three years following fuel price adjustments implemented in April.
Transport Inflation rose to 5.0% in April from negative 1.7% in March after petrol prices increased by N$2.50 per litre and diesel by N$4.00 per litre at the beginning of April.
“We therefore maintain our 2026 annual average inflation forecast in the 4.5%–5.0% range. Under our base-case scenario, where Brent crude averages between US$95 and US$110 through Q2 and Q3, headline inflation is expected to rise toward 4.0%–4.5% by mid-year,” Jansen said.
Simonis Storm said further fuel increases in May, combined with elevated global oil prices and continued disruption around the Strait of Hormuz, are expected to keep inflationary pressures elevated.
The firm said broader second-round effects are now becoming visible across public transport, municipal services and household operating costs.
“Public transport operators have already started adjusting prices higher, with taxi fares officially increasing from N$13 to N$15 during May, while ride-hailing services such as Yango have reportedly raised fares by around 5%,” Jansen said.
Housing and Utility Inflation remained elevated at 4.4% in April, driven by electricity costs, municipal tariff increases and rental inflation.
The report said discussions around an additional 8.40% NamPower tariff adjustment and rising municipal service charges could place further upward pressure on household costs over the coming quarters.
“As long as electricity tariffs, municipal service charges and rental costs continue rising at around 4.5%–5.0% annually, this category alone will make it difficult for headline inflation to fall sustainably below 2.5%,” Jansen said.
Simonis Storm said Food Inflation remains relatively contained at 2.0% for now, but rising transport and logistics costs are expected to push prices higher later in the year, particularly for imported and processed foods.
The firm warned that risks to the inflation outlook remain tilted to the upside if oil prices remain above US$100 per barrel for a prolonged period.
“Should the Strait of Hormuz remain materially disrupted and Brent crude sustain levels above US$110 for an extended period, headline inflation could move closer to the 5.5%–6.0% range by Q3 2026,” Jansen said.
