Interest rate unchanged, unrest affects growth forecast says Sarb Governor
The repo rate remains unchanged at 3.5% with the prime rate at 7%.
The Reserve Bank announced the decision by its Monetary Policy Committee (MPC) on Thursday.
Governor Lesetja Kganyago highlighted the impact of the past week of unrest on the economy.
He said it has affected investor confidence and South Africa's growth outlook.
"Prior to the unrest we were destined to revise our growth forecast for this year. In the aftermath of the unrest we couldn't revise it any higher and decided to keep it the same."
Bruce Whitfield discusses how these events have set back the progress made before the riots (sale of SAA, lifting of self-generation power cap...) with Gibs Business School's Professor Adrian Saville.
Prof. Saville is also an Investment Specialist at Genera Capital.
I think there's a lot of effort that's been put in to try and work out... just the extent of the damage to the economy and the numbers point to somewhere between 0.3% and 1% being taken away in terms of GDP.Prof. Adrian Saville, Investment Specialist - Genera Capital
I think the much greater issue... is that the disruptions of the past week really point to the structural issues that sit resident in the economy, so when we're talking about growth of 2/3/4% we're really fiddling around the margin.Prof. Adrian Saville, Investment Specialist - Genera Capital
The real issue is how we shift the structure of this economy into an absorptive shape.Prof. Adrian Saville, Investment Specialist - Genera Capital
It doesn't really matter if the economy grows 1-4% and no jobs are created - we sit with 35% unemployment, 65% youth unemployment, massive income inequality...Prof. Adrian Saville, Investment Specialist - Genera Capital
Listen to Professor Saville's insights in the audio clip below:
This article first appeared on CapeTalk : Interest rate unchanged, unrest affects growth forecast says Sarb Governor
Source : @SAReserveBank/Twitter