South Africa’s central bank has cut interest rates, as expected, following its decision to bring its rate setting meeting forward by nearly a month.

The Monetary Policy Committee (MPC) reduced its repo rate by another 100 basis points to 9.5%, citing concerns about weaker economic prospects both globally and domestically. 
 
The Reserve Bank has kept interest rates relatively high as it sought to bring down inflation, however the severity of the global economic weakness has forced it cut rates even as its short-term inflation forecasts have risen slightly since the last meeting in February. 

In reaction Nedbank released a statement saying the MPC’s decision to cut interest rates further is welcome, given that economic indicators continue to point towards a bleak economic climate, with manufacturing production and vehicle sales down sharply in January. 
 
“We expect further cuts, with the additional 350 to 400 basis points easing that we expected for the full year likely to be implemented by August this year.  From then on, further action will depend on economic developments both locally and abroad,” said Nedbank.