ELNA MOOLMAN: Stronger winds at play than repo rate breeze
The slow, steady cuts by the Reserve Bank will have a relatively minor market impact, compared with global geopolitics and fiscal reform
The slow and steady interest rate-cutting cycle continued this week with the monetary policy committee (MPC) deciding unanimously to cut the repo rate by a further 25 bps to 7.75%.
At the previous MPC meeting in September, speculation was rife that the bank might cut by a more aggressive 50 bps. This was supported at that time by a marked lowering of the Reserve Bank’s inflation forecasts, then expected to stay below the 4.5% midpoint of the inflation target range for a protracted period (the 2025 inflation forecast average dropped to below 4.5% too). At that time, however, the Bank favoured a smaller (25 bps) increment partly owing to concern about multiple, and elevated, risks to the forecasts. ..
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.