Simonis Storm: Business sinks, consumers soar
Namibian consumers are growing more optimistic about their financial prospects, but that confidence has yet to translate into spending, whilst businesses are absorbing rising costs with little room to pass them on to customers.
That is the central finding of two new proprietary economic sentiment indicators launched by Simonis Storm Securities, the SS Consumer Confidence Index (SS CCI) and the SS Business Confidence Index (SS BCI), the first indices of their kind designed specifically for Namibia.
The inaugural SS CCI registers at 55.9, placing consumer sentiment marginally above the neutral 50 mark. Two thirds of respondents, 66.7%, expect their personal financial position to improve, buoyed by the Bank of Namibia's rate-cutting cycle, which brought the repo rate to 6.5%, and by inflation falling to 2.1% in March 2026, its lowest level since February 2021.
Yet that optimism is not flowing through to consumption. Nearly half of respondents, 44.4% plan to cut spending on durable goods, 47.2% are less willing to take on new debt, and 55.6% expect prices to rise faster, despite the low inflation reading. Consumers, it appears, are building savings rather than spending.
The picture on the business side is starker. The SS BCI registers at 44.1, firmly in depressed territory. Some 71.4% of businesses report rising input costs across raw materials, transport, utilities and labour, with no firms recording cost decreases. New orders are contracting, profit margins are under pressure and hiring intentions are negative.
The one bright spot for businesses is capital expenditure, where the sub-index stands at 64.3, suggesting a subset of firms are investing counter-cyclically in anticipation of a recovery.
The weakest reading across both indices belongs to confidence in government economic management, which scored just 29.2. Among business owners and chief executives, three quarters expressed no confidence, a finding Simonis Storm described as a significant constraint on private sector investment and job creation.
The 11.8-point gap between the CCI and the BCI is what Simonis Storm calls a two-speed economy. Consumers see reasons for optimism; businesses are absorbing pressures that have not yet reached households. The firm said the central question for 2026 is whether consumer optimism eventually converts into the demand that businesses need, or whether business pessimism pulls confidence back down.
The SS CCI and SS BCI will be published quarterly from the second quarter of 2026, with expanded sample sizes and broader geographic coverage. Simonis Storm projects Namibian gross domestic product growth of 2.3% in 2026, with the repo rate expected to average between 6% and 6.25%.
