Amid the doom and gloom of the present COVID-19 crisis – and its devastating financial impact – there was some good news when the SA Reserve Bank’s Monetary Policy Committee announced that it would cut the repo rate by 100 basis points, with effect from 15 April 2020. This takes the repo rate to 4,25% per annum.
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The good news comes amidst anxiety about the future of the South African economy. “The bank expects GDP in 2020 to contract by 6,1%, compared with the -0,2% expected just three weeks ago. GDP is expected to grow by 2,2% in 2021 and by 2,7% in 2022,” the Reserve Bank said.
Robert Gwerengwe, CEO of FNB Gold, explains: