The rand firmed 10c against the dollar in afternoon trade on Thursday after the Reserve Bank kept interest rates unchanged. Citing event risks, particularly those of a political nature, the Bank decided to keep rates unchanged, despite the monetary policy committee (MPC) being split on the decision, with three members favouring a cut and three wishing to keep rates unchanged. The market expected a reduction of 25 basis points in the repo rate. The rand remains a key upside risk to the inflation outlook, governor Lesetja Kganyago said. "Furthermore, some of the event risks, particularly those of a political nature, were now more imminent but with no greater degree of clarity regarding the outcome," he said. The prospect of a further ratings downgrade persisted, particularly given the increased fiscal challenges and political uncertainty, he said. "However, the narrower current-account deficit and the global environment remain supportive of the rand." The rand was at R13.3585 to the d...
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