LESETJA KGANYAGO: Why we are cutting interest rates
Read the statement of the Monetary Policy Committee in full: 'Four members preferred a reduction‚ while two members preferred an unchanged stance'
STATEMENT OF THE MONETARY POLICY COMMITTEE - Issued by Lesetja Kganyago‚ Governor of the South African Reserve Bank Since the previous meeting of the Monetary Policy Committee the inflation outlook has improved. Food price inflation has moderated faster than expected‚ domestic demand pressures remain subdued and international oil prices have declined. Despite a degree of volatility‚ the rand exchange rate has been relatively resilient in the face of expected monetary policy tightening in some advanced economies‚ as well as domestic political risks and uncertainties. Risks to the inflation outlook still remain. At the same time‚ domestic growth prospects have deteriorated further following the surprise GDP contraction in the first quarter of 2017. The economy has now recorded two successive quarters of negative growth‚ and although a near-term improvement is expected‚ the outlook remains challenging. A number of sentiment indicators and data points have reached levels last seen durin...
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