The Reserve Bank said on Thursday (14 August) it was cutting its key repo rate by 100 basis points to 11 per cent, in line with expectations, but dampened hopes for further aggressive cuts in the months ahead.
Domestic markets were betting that interest rates would fall by a further two to three percentage points in 2003 after the central bank kicked off an easing cycle with a wider than expected cut of 150 basis points in its repo rate during June.
The country's four main commercial banks all reduced their prime lending rates (PLRs) by the same amount to 14.5 percent.
In a prepared statement, the governor Tito Mboweni noted that a prolonged recovery in the value of the rand, along with low inflation in the rest of the world and excess production capacity in South Africa, were likely to help keep inflation within its target.
Source: Iafrica
