Repo rate unchanged
Despite a stagnant economy, coupled with several external and internal factors, the SARB's Monetary Policy Committee had decided against increasing the repo rate.
CONSUMERS can breathe a sigh of relief after the South African Reserve Bank’s (SARB) Monetary Policy Committee (MPC) decided to keep the repo rate unchanged at 6.5 per cent.
Despite a stagnant economy, coupled with several external and internal factors, SARB Governor Lesetja Kganyago said, the seven member MPC had decided against increasing the repo rate. Four members voted against an increase while the other three wanted a 25 basis points growth.
“The committee remains concerned about the growing risks to the inflation outlook mainly due to exchange risks related to both domestic and external factors elevated by international oil prices and the possibility of higher electricity tariffs,” he said.
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However, he said, demand pressures in the economy were not assessed to pose a significant risk to the inflation outlook.
“The MPC assesses the risk focus to be moderate on the downside,” he said.
The committee, he added, continues to be of the view that current challenges to the economy are primarily structural in nature and cannot be solved by monetary policy.
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