SA’s inflation still in check as repo rate remains unchanged

Governor Lesetja Kganyago announced the decision of the monetary policy committee on Thursday afternoon, saying the country’s economy had continued to recover despite a number of setbacks.

FILE: South African Reserve Bank Governor Lesetja Kganyago. Picture: @SAReserveBank/Twitter

JOHANNEBSURG – The South African Reserve Bank (Sarb) said the country’s inflation was still in check and it had therefore decided to keep the repo rate unchanged at 3.5%.

Governor Lesetja Kganyago announced the decision of the monetary policy committee on Thursday afternoon, saying the country’s economy had continued to recover despite a number of setbacks.

Kganyago said economic growth would have been better if not for the looting and violence.

“The GDP growth estimate for 2021 remains unchanged at 4.2%, while growth in 2022 is revised slightly lower at 2.3% (from 2.4%) and unchanged at 2.4% in 2023.”

He said a number of problems were holding growth back.

“Recent unrest and economic damage could have lasting effects on investor confidence and job creation. The direct and indirect costs of these events will likely further slow South Africa’s economic recovery. We estimate the unrest to have fully negated the 2021Q1 growth outcome.”

But he said consumer spending was increasing and the economy was growing.

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