Business 19.7.2018 03:32 pm

Repo rate remains unchanged

Reserve Bank governor Lesetja Kganyago. (Photo by Gallo Images / Business Day / Trevor Samson)

Reserve Bank governor Lesetja Kganyago. (Photo by Gallo Images / Business Day / Trevor Samson)

At a media briefing in Pretoria, the central bank’s governor Lesetja Kganyago also announced a downgrade to growth projection.

The SA Reserve Bank (SARB) announced today that its monetary policy committee has unanimously decided to leave the repo rate unchanged at 6.5%, Fin24 has reported.

Central bank governor Lesetja Kganyago delivered the announcement, which will not come as a surprise to economists, most of which are reported to have expected the news.The repo rate is the benchmark interest rate at which the Reserve Bank lends money to other banks. Changes in the repo rate affect the prime lending rate, which is the lowest rate at which banks start lending to clients.

READ MORE: Reserve Bank cuts benchmark repo rate, as expected

The fact that the repo rate has not changed means the prime lending rate will remain at 10%.

At the same briefing, Kganyago also announced a downgrade in growth projection.

Kganyago said the central bank expects GDP growth of 1.2% in 2018, down from its previous estimate of 1.7%.

Regarding growth, he said “the outlook remains constrained.”

SARB expects growth to increase to 1.9% in 2019.

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