Reserve Bank Governor, Lesetja Kganyago has announced a rate cut of 25 basis points amid an evenly balanced inflation outlook and slightly better economic growth forecasts.
Kganyago was speaking in Pretoria on Wednesday after the three day meeting of the monetary policy committee. The rate cut means that the prime lending rate will drop to 10%.
Economist George Glynos says many factors counted in favour of a rate cut. Glynos says this is because the political risks have gone, “The budget risks have gone. The rating downgrading risks have gone. The transitional risks have gone and a host of other things that might impact on the rand. Then we’ve got inflation which is on the downside even though it has accelerated more recently.”
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