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In an unprecedented move in the wake of the coronavirus the South African Reserve Bank cut interest rates by another 100 basis points to 4.25%.
The SARB said in a statement that the May 2020 meeting of the MPC was moved earlier and took place today. The MPC will host a media briefing later today.
The rand weakened after the surprise announcement and is currently trading at R18.15 after trading around the R18.00 level for most of the day.
The move is to help stimulate the already limping economy as it takes a battering from an extended nationwide lockdown to 35 days to slow the spread of the Covid-19 pandemic.
The economy which is in recession is expected to contract as much as 4% this year, all while Moody’s Investors Service cut the country’s debt to junk on March 27 and Fitch Ratings lowered its assessment deeper into sub-investment grade a week later.
The latest cut brings the total decrease in interest rates since the beginning of the year to 225 basis points.
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