Sarb to continue cautious approach to repo rate as SA recovers from pandemic

South African Reserve Bank Governor Lesetja Kganyago said that there were a number of positive factors after a very difficult 2020.

FILE: South African Reserve Bank Governor Lesetja Kganyago. Picture: AFP

JOHANNESBURG - The South African Reserve Bank said that it would continue to adopt a cautious approach to the repo rate as the country recovered from the effects of the COVID-19 pandemic.

The Monetary Policy Committee has decided to keep the repo rate unchanged at 3.5%.

Governor Lesetja Kganyago said that there were a number of positive factors after a very difficult 2020.

Kganyago said that the country’s growth figure for this year was predicted to be 4.2%.

“The stronger growth forecast reflects better sectoral performances and a more robust chance for trade in the first quarter of this year,” Kganyago said.

He said that the MPC has noted that inflation had increased but he did not expect this to increase significantly.

“If our analysis is that it feeds into a continuous rise in inflation, we stand ready to act,” he said.

The governor also said that commodity prices were also up, which was boosting the local economy.

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