50 basis point cut on repo rate wasn't on the table when MPC met - SARB

The South African Reserve Bank (SARB) says a 50 basis point cut on the repo rate was not on the table when the monetary policy committee (MPC) met for the November meeting this week.

The central bank announced its latest decision on policy rates on Thursday, where the six-member MPC cut the benchmark policy rate down by 25 basis points.

This means the repo rate now stands at 6.75%, while the prime lending rate stands at 10.25%.

Reserve Bank Governor Lesetja Kganyago said the quarterly projection model continues to forecast gradual rate cuts as inflation subsides. 

"If you were to, for now, forget the QPM is a policy guide and you were just following it and accept it as the seventh member of the MPC, the QPM had said it’s 25bps at a couple of meetings going forward – it had like 5 points of 25bps."

While risks have subsided slightly, Kganyago said that caution was still needed.

"We are in a very uncertain environment and it’s important that we move with caution. And as we stated, the future decisions would be taken based on the outlook, the incoming data and our assessment of that means."

Thursday’s cut brings the cumulative easing cycle in 2025 to 100 basis points.