Thursday, 19 May 2016 17:26

Repo rate remains unchanged at 7%

The Reserve Bank on Thursday kept South Africa’s repo rate unchanged at 7 percent per annum.

The Reserve Bank says a further rating downgrade of South Africa could lead to capital outflows.

“Tolerating additional inflation in the short run could require larger interest rate adjustments later, with proportionally greater costs for the economy.

After improving marginally to 42 in 4Q2015, the FNB/BER Civil Confidence Index lost 14 points to register a level of 28 in 1Q2016.

Thursday, 17 March 2016 17:57

Reserve Bank raises repo rate to 7%

The Reserve Bank on Thursday increased South Africa’s repo rate by 25 basis points to 7% per annum.

According to Catalyst Fund Managers, the SA Listed Property Index (SAPY) recorded a negative total return (-2.98) for the month ended 31 January 2016.

Ooba says the decision today by the South African Reserve Bank to increase interest rates by 0.5% from 6.25% to 6.75% will negatively impact the residential housing markets as many consumers are already facing increasing financial strain through dealing with elevated levels of debt and the rising cost of living expenses.

The country’s seasonally adjusted real Gross Domestic Product (GDP) at market prices has increased by an annualised rate of 0.7% in the third quarter of 2015.

The South African Reserve Bank’s (SARB) Monetary Policy Committee (MPC) raised the key monetary policy interest rate – the repurchase, or repo rate – by a further 25 basis points from 6% to 6,25% per annum. Due to this hike in the repo rate, Absa announced that its prime lending and variable mortgage interest rates will rise from 9,5% to 9,75% per annum, effective from 20 November 2015.

With a 25 bases points increase in interest rates, consumers can expect tough times ahead with overall retail sales growth to range between 2% to 2.75% for the remainder of 2015.

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