WINDHOEK, Aug. 15 (Xinhua) -- Namibia's domestic economic activity improved during the first six months of 2018 relative to the corresponding period of 2017, according to the Bank of Namibia.

The central bank Governor, Ipumbu Shiimi at a monetary policy announcement on Wednesday said that the improved activity was mainly observed in the mining as well as transport and communication sectors.

"The wholesale and retail trade sector, however continued to decline, though at a slower pace compared to the corresponding period of 2017," he added.

According to Shiimi, overall the domestic economy is expected to grow by 0.6 percent in 2018 compared to the contraction registered in 2017.

Meanwhile, the governor said the annual inflation fell to 3.7 percent during the first six months of 2018 from 7 percent during the corresponding period in 2017.

"The lower inflation rate was mainly due to lower price increases in the food and non-alcoholic beverages as well as housing categories," he added.

Going forward Shiimi said inflation is expected to average around 4.1 percent in 2018. Shiimi also said that the central bank decided to to maintain the repo rate unchanged at 6.75 percent.

"This decision was taken following a review of global, regional and domestic economic and financial developments," he said. Enditem

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