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Posts Tagged ‘repo rate’

May 12 2011

Repo Rate Remains Unchanged @ 5.5%

Reserve Bank Governor Gill Marcus today announced that the Repo Rate will remain unchanged at 5.5%. This is good news for anybody with a mortgage loan , personal loan , car loan or credit card debt. However signs are that at some point we could see an increase in the rate.  The MPC concedes that inflation is likely to breach the upper target during the first quarter of 2012.

Governor Marcus cites cost push pressures being the primary cause for the breach making it easier not to increase rates. The Reserve Bank’s dual mandate of growth/jobs and inflation must have played a major role in keeping rates unchanged. The MPC are probably very aware of the high unemployment rate in South Africa , 25% , which is probably the highest unemployment rate in the world.

Factors that are likely to put pressure on South African inflation over the near future are the oil price and the Rand/Dollar exchange rate.  It seems that the period of rate cuts are over and the next moves in the Repo Rate will be higher. If you have a large level of debt on a variable rate , now might be a good time to consider fixing your interest rate.

March 26 2010

Interest Rate - Good News

Governor Gill Marcus presented everyone paying either a mortgage loan or car loan with some great news yesterday , the MPC has cut the repo rate by 50 basis points (0.5%) reducing the rate to 6.5%.  The move was generally unexpected and took the market by surprise , but most South Africans with debt certainy aren’t complaining.

XE.com - TEXT-South African central bank statement on rates

PRETORIA, March 25 (Reuters) - South Africa’s central bank cut its repo rate by 50 basis points to 6.5 percent on Thursday. Below are extracts from the bank’s statement, posted on its website. INTRODUCTION … The MPC has therefore decided to reduce the repurchase rate by 50 basis points to 6.5 percent per annum with effect from 26 March 2010. The MPC will continue to assess developments, and will adjust the monetary policy stance when necessary in order to achieve the …

Bush Radio 89.5 fm Newsroom: Rate cut generally welcomed

The Federation of Unions of South Africa says they are pleased with the Reserve Bank Monetary Policy Committee’s announcement today that the repo rate would be cut by 50 basis points or zero-point-five-percent. … George says the MPC is providing much needed room for monetary stimulus. George added that the economy is struggling with low consumer spending, high unemployment figures and lower personal income tax while the nation currently has a budget deficit. …

Repo Rate Cut « RealPro – Estate Agency

Johannesburg – The South African Reserve Bank’s (Sarb’s) monetary policy committee (MPC) has cut the key points on Thursday, bringing it down to 6.5%, with the prime lending rate dropping to 10%. The repo rate is the rate at which the central … Economists were unsure whether favourable inflation data would sway the MPC to lower rates. Statistics SA said on Wednesday consumer price inflation measured 5.7% year-on-year in February, below Sarb’s upper target range of 6%. …

South Africa: dovish SARB delivers surprise rate cut | Forex Info …

The South African central bank (SARB) announced that the Monetary Policy Committee (MPC) has decided to cut its key policy rate by 50bp, bringing it down to 6.50%. Details The key policy rate was cut by 50bp to 6.50% at the MPC meeting …

South Africa: Central Bank Cuts Interest Rates | Get Some News …

The Reserve Bank’s Monetary Policy Committee (MPC) has cut the repo rate by 50 basis points to 6.5 percent to the delight of many South Africans. Read more here: South Africa: Central Bank Cuts Interest Rates …

Here is an extract from former Governor Tito Mboweni urging the MPC to hold it steady as its not the time to cut in his opinion , fortunately for home and car owners the MPC decided to ignore his advice;

South Africa: Hold It Steady – It is Not the Moment for MPC to …

… thing as an easy interest rate decision, that every time the Bank’s monetary policy committee (MPC) met, it had to make a tough call. See original here: South Africa: Hold It Steady – It is Not the Moment for MPC to Risk a Rate Cut.

The news is certainly welcomed by everyone paying off a mortgage or car loan as well as many in the business sector who feel that an easier monetary stance will help stimulate the economy. The decision to cute rates can be attributed to the revised mandate that the Reserve Bank was given during Finance Minister Gordhan’s budget speech. Organise labour was instrumental in bringing about this policy shift.

May 28 2009

MPC Cuts Rate 1%

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.