afrol News, 30 April - The Reserve Bank of South Africa has announced a 100 basis point cut in the repo rate, as a further relief to the country's economic pressures.

Making the announcement at the end of a two-day Monetary Policy Committee (MPC) meeting, the Reserve Bank Governor, Tito Mboweni, said the repo rate would decrease to 8.5 per cent with effect from next Monday, the news that have been welcomed across the country by economists, businesses, unions and ordinary citizens.

The Reserve Bank had also last month, cut the repo rate by 100 basis points to 9.5 percent, with pressure mounting against the global trends. The country, according to economists may have to effect another cut next month with the economic growth outlook still gloomy for the country.

Mr Mboweni said in making the decision, the policy committe was of the view that the adverse economic conditions continue to tilt the balance of risks to the inflation outlook to the downside over the medium term.

According to the Governor, the MPC had considered the severe "synchronised" downturn in international and domestic economic conditions.

Reports from South Africa have said that some banks have already responded to the announcement, lowering their interest rates. The state news agency, BuaNews, reported that Standard bank and First National Bank have indicated that they will be reducing their prime lending rate from 13 to 12 per cent effective from Monday.

Meanwhile, the country's Department of Minerals and Energy, has also announced a decrease in the price of all grades of petrol by 3 cents per litre from midnight next Wednesday.

However, according to the new prices, the wholesale price of Diesel, 0.05 percent sulphur, will increase by 8 cents per litre while the wholesale price of Diesel, 00.05 percent sulphur, will increase by 6 cents per litre, the department said.

The department further announced that the wholesale price of illuminating paraffin and illuminating paraffin at the Single Maximum National Retail price will increase by 13 cents and 17 cents per litre respectively.

By staff writer

© afrol News

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