Reserve Bank Holds Rates at 7.75% as Inflation Nears Target Range
The Monetary Policy Committee's unanimous decision reflects confidence that headline inflation will return to the 3-6% target band by year-end.
The South African Reserve Bank has maintained the repurchase rate at 7.75% per annum, with the Monetary Policy Committee voting unanimously to hold despite growing calls for monetary easing from business and labor groups.
Governor Lesetja Kganyago cited lingering inflation risks from administered prices, particularly electricity tariffs, as justification for the cautious stance. Headline inflation came in at 4.6% in March, comfortably within the target range but with core inflation sticky at 4.9%.
The decision disappointed equity markets, with the JSE All Share Index closing 0.8% lower on the day. Bond yields ticked higher, with the benchmark R2030 rising 8 basis points to 9.42%.