An extraordinary week has passed since the government ordered and prepared for a shutdown of much (how much?) economic activity to deal with the Covid-19 health crisis. All, including the participants in capital markets, have tried to come to terms with the evolving realities at home and abroad. And it was a week when the SA Reserve Bank moved from conventional to unconventional monetary policy.

At its monetary policy proceedings on March 17, the Bank reported in an explicitly conventional way. It cut its key repo rate by an unusually large 100 basis points on an improved inflation outlook. By March 25, it was practising a kind of quantitative easing (QE), buying SA bonds in the market to reduce “excessive volatility in the prices of government bonds” and freely providing loans to banks of up to 12 months...

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