SARB increase repo rate to 5.75%

Gill Marcus (South African Reserve Bank – SARB) have just announced that they will raise the repo rate by 25 basis points. This was decided following talks between Marcus and the fellow Monetary Policy Committee. The repo rate hike will occur tomorrow and will now be 5.75% for the year. The hike was long overdue as a result of a weaker rand, slow growth expectation as well as constant labour unrest. SARB have further decreased the expected growth rate of South Africa down to 1.7% which is slightly lower than America’s expected growth rate of 2%. Marcus has stressed the importance of the NDP plan as a way of increasing growth in the country. Inflation still sits above the targeted 3 – 6% range and this has yet to have an impact on South African spending levels.