Reserve Bank sees more room for stimulus
The Bank warned that the deficit could exceed 10% of GDP in 2020 due to the coronavirus
The coronavirus outbreak and SA’s 21-day lockdown could see SA’s economy contract by as much as 4% in 2020, the Reserve Bank said, as it also indicated that slowing inflation might give it space to offer more monetary support.
The figures, in its monetary policy review released on Monday, are steeply down from the growth forecasts given at its last monetary policy committee (MPC) meeting in March. At that meeting, the Bank cut the repo rate by 100 basis points, the most in more than a decade, in a pre-emptive strike to support the economy.