Stronger rand, improved inflation outlook factors in repo rate cut

Those in debt have received some relief on Thursday afternoon with the South African Reserve Bank (Sarb) decreasing the repo to 6.5%.

Picture: Supplied

JOHANNESBURG - A stronger rand, improved inflation and an overall improved outlook have been highlighted as some of the factors that have led to a decrease in the repo rate by 25 basis points.

Those in debt have received some relief on Thursday afternoon, with the South African Reserve Bank (Sarb) decreasing the repo to 6.5%.

The Reserve Bank has been reluctant to decrease the repo rates during the past few meetings of the monetary policy committee.

However, Governor Lesetja Kganyago said the decision this time was unanimous, noting that inflation had now stabilised.

“Inflation expectations have continued to moderate, according to the Bureau for Economic Research’s second-quarter survey.”

However, he said growth remained a concern: “The Sarb now expects growth for 2019 to average 0.6%.”