Johannesburg – South Africa’s central bank trimmed its main lending rate on Thursday, easing monetary policy to support a sluggish economy after pressure on the rand.
The bank’s monetary policy committee cut the rate by 25 basis point to 7.25 percent, said central bank governor Lesetja Kganyago.
The new rate is lowest in more than two years.
“The exchange rate has since recovered and conditions seem more settled than they did in March,” Kganyago told journalists, warning that the global environment remained “uncertain”.
The bank estimates South Africa’s economy will grow by 1.2 percent in 2025 after a 0.6 percent expansion last year.
The International Monetary Fund meanwhile revised down its growth forecast for the country to one percent.
“We do not yet have the official data for growth in the first quarter. However, the indicators for sectors like mining and manufacturing have been disappointing, and unemployment has risen,” Kganyago said.
Africa’s most industrialised economy is burdened by an employment rate that tops 32 percent, one of the highest in the world. Young people are the most severely affected.
Annual consumer inflation stood at 2.8 percent in April, from 2.7 percent in March, mainly due to a sharp rise in meat prices.
Follow African Insider on Facebook, Twitter and Instagram
Picture: X/@Spha_Gruffy
For more African news, visit Africaninsider.com
Compiled by Betha Madhomu
