Good news for consumers and anyone with debt , the Monetary Poilicy Committee (MPC) of the South African Reserve Bank (SARB) cut the Repo rate by 100 basis point. This is pretty much in line with what the markets were expecting and equities and the Rand all responded well to this positive news.

Reserve Bank Governor Tito Moboweni did however warn that future rate cuts could not be counted on as cost pressures within the South African economy were still high and the SARB still had its eye on inflation and its inflation targeting mandate.

It is unlikely that these rate cuts will have an immediate impact on consumer confidence and spending as most consumers will look to reducing mortgage loans and other debts like car loans and credit cards. Many are probably behind on their debt commitments so any interest savings will in any likelihood be used to catch up on overdue amounts.

Anyone who is paying off a mortgage or a car loan at least has reason to smile tonight. To calculate your new bond payment and see what you monthly savings will be you can use our mortgage payment calculator.