SARB keeps repo rate unchanged at 8.25%

For the third consecutive time in 2023, the South African Reserve Bank (SARB) at the last monetary policy for the year, which took place yesterday, decided to keep the repo rate unchanged at 8.25%. According to Stats SA, annual consumer price inflation (CPI) climbed to 5.9% in October from 5.4% in September.The South African Reserve Bank monetary policy committee prefers to anchor inflation expectations close to the 4.5% midpoint of its 3%-6% target range, Fin24 reported. The sixth monetary policy announcement for the year by the Bank of Namibia (BoN) is expected to take place on 6 December. There is a 50 basis points differential in the repo rate between Namibia and South Africa.Market Watch on Monday reported that despite the interest rate differential of 0.50% between South Africa and Namibia, the Bank of Namibia is not concerned about capital outflows. ThresholdAccording to BoN’s spokesperson Kazembire Zemburuka, the minimum intervention threshold at which the level of foreign reserves shall be considered inadequate is defined as the foreign reserves falling short of the following coverage ratios: (1) currency in circulation plus a 12-month average of cross-border transfers and short-term external debt or (2) three months’ worth of imports.As at 31 October 2023, the preliminary foreign exchange level stood at N$53.369 billion which covers ratio (1) by 5.3 times and ratio (2) by 5.5 months’ worth of imports.At these levels, the foreign exchange reserves are considered adequate to support the peg to the South African rand. Given this background, the central bank is not concerned with the current run rate of outflows, he added.Between January and October, commercial bank outflows amounted to N$17.9 billion versus N$12.5 billion recorded in the corresponding period of 2022, Zemburuka said.-phillep@nmh.com.na

SARB keeps repo rate unchanged at 8.25%

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Republikein 2025-06-18

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SARB keeps repo rate unchanged at 8.25%

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