Repo rate raised by 25 points to 6,75%
The repo rate is being increased by 25 basis points to 6.75%. Reserve Bank governor, Lesetja Kganyago announced the monetary policy committee's much-anticipated decision in Pretoria this afternoon.
The governor says should the adjustment have been delayed - this could cause higher levels of inflation at a later stage.
"Delaying the adjustment could cause inflation expectations to become entrenched at higher levels and thus contributes to second round effects which could require an even stronger monetary policy response in the future. Against this backdrop, the MPC has decided to increase the repurchase rate by 25 basis points to 6,75% per year effective from the 23rd of November, 2018."
This takes the prime lending rate to 10.25%.
Kganyago says the MPC was split - with three members preferring a rate increase and three voting for an unchanged rate.
