Repo rate stays the same

Reserve Bank Governor Lesetja Kganyago.Picture: Gallo Images

The Monetary Policy Committee has decided to keep the repo rate at 3.5% effective from tomorrow.

Reserve Bank governor Lesetja Kganyago made the announcement during a media briefing on Thursday afternoon.

The repo rate, the rate at which the central lends money to commercial banks, has seen five consecutive cuts this year on the heels of an economic downturn that was more severe in the second quarter of 2020.

The bank has reduced the rate by 300 basis points so far this year to stimulate growth after the adverse effects of the Covid-19 lockdown.

In addition, the bank lowered its economic forecast for the year, predicting that GDP will shrink by 8.3%, compared to the contraction of 7.3% forecast previously.

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