Reserve Bank may keep rate cut in reserve
Rand has weakened and the global environment is more uncertain
After a dramatic year in which it halved interest rates, bought more than R41bn of bonds to keep the market liquid, and liberalised rules to keep banks lending in the face of the Covid pandemic, the Reserve Bank is set for a quieter 2021, starting with a likely "hold" on interest rates.And with growth prospects weakening and price pressures muted, most economists expect the benchmark repo rate to stay on hold at a record low 3.5% for the rest of 2021. That will keep short-term borrowing costs low and provide relief for households and companies in tough times, but won't necessarily help to drive the investment and growth SA needs, economists say. However, if the economic outlook gets much weaker, further cuts could be possible.Reuters found that 17 of 20 economists it polled predicted that the Bank's monetary policy committee would keep the repo rate unchanged at its monetary policy committee meeting this week. A Finder's economist panel said 93% of the econo-mists it surveyed expe...
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