Further repo rate cut mooted at next MPC

JOHANNESBURG – The South African Reserve Bank on Thursday left the door open for a final rate cut before Christmas after two members of the Monetary Policy Committee (MPC) voted in favour of a 25 basis point rates cut.

The central bank’s Governor Lesetja Kganyago said that the MPC was not unanimous on the decision to maintain the repo rate, but signalled that the rates easing cycle could be coming to an end.

Kganyago said South Africans should expect an upward review of the rates regime in the third and fourth quarters of 2021.

He said the repo rate projection from the Quarterly Projection Model remained a broad policy guide, changing from meeting to meeting in response to new data and risk.

“In this highly uncertain environment, future decisions will continue to be data dependent and sensitive to the balance of risks to the outlook,” Kganyago said.