South African Reserve Bank Maintains Main Repo Rate at 8.25%

By Alexandra Wexler

JOHANNESBURG--The South African Reserve Bank maintained its main repo rate at 8.25% on Thursday, in an effort to keep inflation in check amid a continuing electricity crisis, weak currency and commodity prices as well as logistical constraints at the country's rails and ports.

The SARB kept the rate on hold for the fourth consecutive meeting.

The central bank also lowered its economic growth forecast for 2023. The bank now projects that South Africa's economy grew 0.6% last year, down from its November forecast of an 0.8% expansion, as household consumption and investment eased. In 2024, the SARB expects growth of 1.2%, unchanged from the bank's November estimate.

The country's rand currency depreciated over the past year by about 11% against the U.S. dollar, making it one of the worst performing emerging-market currencies, SARB Governor Lesetja Kganyago said.

Near-constant breakdowns of South Africa's aging coal power plants and a lack of money to buy diesel for emergency generators have led to rolling nationwide blackouts of up to 11-and-a-half hours a day, hampering economic growth.

Write to Alexandra Wexler at [e-mail]

(END) Dow Jones Newswires

01-25-24 0851ET