The Reserve Bank has cut interest rates by one percentage point for the second time in just less than a month, bringing the repo rate down to 4.25% on Tuesday morning.
The SA Reserve Bank has cut the repo rate by 100 basis points, or one percentage point. This brings SA’s repo rate to 4.25%.
Tuesday’s announcement was the second major cut in less than a month, after the central bank cut the rate by one percentage point in mid-March.
“The May 2020 meeting of the MPC was moved earlier and took place today [Tuesday],” the bank said in a tweet.
The repo rate is the benchmark interest rate at which the Reserve Bank lends money to other banks.
The unexpected cut cause the rand, which had been firming during the morning, to weaken from around R18.02/$ to around R18.17/$.
The bank’s Monetary Policy Committee is set to host a media briefing via Zoom on Tuesday morning to explain the sudden cut.