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Moneyweb reports that the repo rate of the SA Reserve Bank (Sarb) remained unchanged at 8.25%, bank governor Lesetja Kganyago confirmed in a widely expected move on Thursday.
This was the second consecutive time that the SARB’s Monetary Policy Committee (MPC) opted to keep rates steady, to the relief of many South Africans and businesses. It means that the prime lending rate of commercial banks remains at 11.75%. The MPC took a ‘hold’ decision at its penultimate meeting in July, following an aggressive hiking cycle of a cumulative 475 basis points since late 2021 in the wake of spiking inflation. Inflation is now within the SARB’s target range, despite a slight uptick in the latest CPI reading for August, which came in at 4.8% year-on-year on Wednesday. In his MPC statement, Kganyago noted: “With services inflation lower in the near term, headline inflation for 2023 is revised down to 5.9% [from 6%]. The headline inflation forecast for 2024 increases slightly to 5.1%, before stabilising at 4.5% in 2025.” However, Kganyago warned that the risks to the inflation outlook were still “assessed to the upside” and “the job of tackling inflation is not done”. Kganyago reported that the bank’s GDP growth forecast for 2024 and 2025 was unchanged from the previous meeting, at 1% and 1.1%, respectively.
- Read the full original of the report in the above regard by Suren Naidoo at Moneyweb
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