Given the vulnerability of South Africa’s economy in the wake of last week’s unrest, as anticipated, the Monetary Policy Committee adopted an accommodative approach by deciding to keep the repo rate steady at 3.5%, which leaves the prime rate at 7%, says Dr Andrew Golding, chief executive of the Pam Golding Property group.

With South Africa’s inflation rate below the lower limit of the inflation target at 2.9%, and local inflationary expectations remaining well-anchored, it was expected that the Monetary Policy Committee would keep the repo rate unchanged, says Dr Andrew Golding, chief executive of the Pam Golding Property group.

South African home buyers can look forward to a few more months of record-low interest rates as the Monetary Policy Committee has once again opted to hold the repo rate steady at 3.5%.

While a further reduction to the interest rate would have been a bonus for aspirant first-time home buyers and existing homeowners with mortgages, the Monetary Policy Committee’s decision to leave the repo rate unchanged at 3.5% was anticipated by the majority of market commentators, says Dr Andrew Golding, chief executive of the Pam Golding Property group.

Further repo rate cut would have provided relief for economy and boosted housing market, says Dr Andrew Golding.

All eyes will be watching to see how the latest GDP figures impact the MPC’s interest rate decision next week, as well as eagerly awaiting the upcoming October Medium-Term Budget Policy Statement (MTBPS).

Experts are divided on whether the South Africa Reserve Bank (SARB) Monetary Policy Committee (MPC) will hold or decrease the repo rate later this month, according to Finder’s panel of 11 experts.

“In an unexpected but welcome announcement, the Monetary Policy Committee today (14 April 2020) announced a further 100bps cut in the repo rate, reducing it to just 4.25%.

In line with market expectation, the Reserve Bank has cut the repo rate by 100 basis points to 5.25% per annum, Governor Lesetja Kganyago announced on Thursday.

Against the backdrop of the unprecedented times we find ourselves in, today’s (19 March 2020) decision by the Monetary Policy Committee to reduce the repo rate by 100bps is a critical step towards financial survival.

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