Repo rate to stay stable for some time to come

The repo rate -- which is the rate at which the South African Reserve Bank (SARB) lends money to commercial banks -- will stay stable "for some time to come", SARB Governor Gill Marcus said at a conference hosted by the Bureau for Economic Research in Sandton, Johannesburg.

"Of course, this depends on no major developments taking place," Marcus said.

There had been rumours that as a result of poor retail sales data for February, another cut was just around the corner. "I must warn against jumping to conclusions on one month's data," Marcus said.

She said it was important to look at the reasons for the latest repo rate reduction, which had taken place in March.

"Our statement emphasised that despite clear signs that the economy had emerged from the recession, the pace of recovery was still below potential. "We saw the improvement in consumption expenditure in particular as being tenuous."

Source: Mail & Guardian