The South African Reserve Bank (Sarb) today, in a surprise move, slashed the benchmark repo rate by another 1% to 4.25%.
The move by the SARB to reduce the prime rate, which is the interest rate that commercial banks charge thier customers, is now 7.75% from 8.75%.
The central bank, in a statement, said its Monetary Policy Committee (MPC) had decided to cut the repo rate by 100 basis points after the committee moved forward its May meeting in response to the debilitating impact of COVID-19 on the economy and households.
The MPC, at its last meeting last month, cut the repo rate by 100 basis points.
The Sarb last week said it expects the economy to shrink by as much as 4% this year and more than 1,600 small businesses to go under as a result of COVID-19.
The central bank also expects 370 000 jobs to be lost in the formal sector alone.
This is a developing story and will be updated after the MPC media briefing set for 11:30am
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