JOHANNESBURG, Sept. 21 (Xinhua) -- The Monetary Policy Committee (MPC) of the South African Reserve Bank (SARB), the central bank, on Thursday voted to keep the repurchase rate unchanged at 8.25 percent with effect from Friday.
The decision by the SARB is in line with many economists' predictions after annual consumer price inflation ticked up slightly to 4.8 percent in August from 4.7 percent in July.
In the five-member Monetary Policy Committee, three members voted to maintain the repo rate steady, and two members voted for a 25-basis-point increase. Economists pointed out that the decision that was not made unanimously indicated that South Africa continues to operate in an uncertain condition despite the inflation in South Africa leveling out.
As for the repurchase rate unchanged, Lesetja Kganyago, governor of the SARB, explained Thursday that South Africa's load-shedding has increased, and the exchange rates for exporting raw materials remain weak, the future for agriculture is currently threatened by increased El Nino circumstances, and global climatic events add extra dangers.
A pause in the repurchase rate in South Africa is welcomed by some experts.
"High interest rates, together with load shedding, more expensive power, food, and fuel, put great pressure on companies and individuals. The decision by SARB will give consumers a much-needed break -- especially for those with debt," said Thys van Zyl, chief executive officer of Everest Wealth, a private investment and wealth management company. If the SARB could maintain the repurchase rate or reduce it in November, it would help households service their debts for the December festive season, added van Zyl.
While most economists had anticipated that the repurchase rate would remain unchanged, Jannie Rossouw, a professor at Wits University, said there are still worries about inflation. "A further increase might be justified. What happens in the next meeting would depend on what happens with the inflation," said Rossouw.