Reserve Bank cuts repo rate by 25 basis points
The Reserve Bank has introduced a 25 basis points rate cut, with Governor Lesetja Kganyago saying inflation is expected to be "well contained" in the medium term.
Kganyago on Thursday announced that the Monetary Policy Committee was divided on the decision.
The repo rate - which is the benchmark interest rate at which the Reserve Bank lends money to other banks - is now at 3.5%.
The Reserve Bank has already lowered interest rates by 275 basis points this year to provide relief to indebted consumers and firms in response to the Covid-19 pandemic. But there have been calls for it to take more aggressive monetary policy action to support the economy.
The Reserve Bank has revised its GDP growth outlook to -7.3% for 2020, worse than the 7% projection in May and worse than Treasury's forecast of 7.2%.
"Easing of the lockdown has supported growth in recent weeks and high frequency activity indicators show a pickup in spending from extremely low levels.
"However, getting back to pre-pandemic activity levels will take time. GDP is expected to grow by 3.7% in 2021 and by 2.8% in 2022," Kganyago said.
The bank still expects inflation to average at 3.4% for 2020. "The overall risks to the inflation outlook at this time appear to be balanced," he said.
Risks to inflation from currency depreciation are expected to be muted, he added.
But administrative prices such as electricity remain a concern for inflation.
"Upside risks to inflation could also emerge from heightened fiscal risks and sharp reductions in the supply of goods and services," said Kganyago.
Comments
Research Reports
Projects
Latest News
Showroom
Weir Minerals Europe, Middle East and Africa is a global supplier of excellent minerals solutions, including pumps, valves, hydrocyclones,...
VISIT SHOWROOM
Supplier & Distributor of the Widest Range of Accurate & Easy-to-Use Alcohol Breathalysers
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
