The South African Reserve Bank’s (SARB’s) monetary policy committee (MPC) announced yesterday that the repo rate would remain unchanged at 6.75%.
Reserve Bank governor Lesetja Kganyago said this was the first time since the previous meeting of the MPC, that the rand appreciated by 13.1% against the dollar, by 9.6% against the euro, and by 10.6% to the pound.
He warned “in the near term, expectations are that the rand will remain sensitive to the general feeling stemming from political developments”.
“The lingering prospect of a credit-ratings downgrade to sub-investment grade by Moody’s [also] continues to weigh on the longer-term outlook for the rand,” he said.