JOHANNESBURG – South African consumers today breathed a sigh of relief after the central bank kept interest rates unchanged in a close vote.

The Reserve Bank said it continues to assess the stance of monetary policy to be accommodative.

Four members of the bank’s Monetary Policy Committee preferred an unchanged stance, while three of their colleague’s three members preferred a 25 basis points increase.

This means the repurchase rate remained unchanged at 6.5 percent per annum.

Mike Greeff, chief executive of Greeff Christies International Real Estate, said the decision by the Monetary Policy Committee (MPC) to leave the repo rate unchanged comes as a huge relief to consumers.

“With the recession a reality, the government has taken the conscious decision to avoid straining consumers even further than they are currently and will be positive in helping people maintain their current bond repayments,” Greeff said.  

However, the MPC said it remains concerned about the deteriorating inflation outlook.

Mamello Matikinca, FNB chief economist, said the central bank kept rates unchanged in the hope that doing so can assist a very modest growth recovery in the second half of 2018. 

“Nevertheless, as US monetary policy normalisation continues, we expect the MPC to begin a gradual rate hiking cycle at the November meeting,” Matikinca said.