//Sarb’s MPC cuts the repo rate

Sarb’s MPC cuts the repo rate

The SA Reserve Bank’s Monetary Policy Committee has decided to reduce the repo rate by 25 basis points – a unanimous decision.


Headline CPI inflation is expected to peak at 4.9% in the final quarter (Q4) of 2020 and settle at 4.5% in the third quarter of 2021 (one quarter earlier).

The forecast for core inflation for 2019 is unchanged at 4.2%, is 4.3% in 2020 (down from 4.5%) and 4.4% in 2021 (down from 4.6%). The Bank’s forecast for core inflation for 2022 is 4.5%.


The forecast of GDP growth for 2019 has been revised lower to 0.4% (from 0.5%).

The forecasts for 2020 & 2021 have decreased to 1.2% (from 1.4%) and 1.6% (from 1.7%), respectively, due to lower growth than previously expected in Q 3 & 4.

The GDP forecast for 2022 is 1.9%.


Since the November MPC meeting, the rand has appreciated 2.6% vs the US  dollar and 1.8% versus the euro.

While the rand has benefited from improvements in global sentiment, high long term bond yields reflect concerns about domestic growth prospects.

Governor Lesetja Kganyago said implementation of prudent macroeconomic policies and structural reforms that lower costs & increase investment, potential growth and job creation remains urgent

Developing story.

Source: Moneyweb