Economists say the Reserve Bank will have to implement aggressive rate cuts to support the struggling economy amid the worsening effect of the coronavirus.
Sharp declines in stock markets and currencies have been experienced around the world.
The overall Johannesburg Stock Exchange (JSE) index plummeted just over 6% in early trade on Monday morning in line with global stocks.
Markets @ 09:05 pic.twitter.com/06suY2ktTT
— JSE (@JSE_Group) March 9, 2020
Video: Market update on Monday
The rand also weakened by nearly 50 cents against the US dollar – but has since strengthened somewhat to around 15-96 to the greenback.
ETM Analytics’ Chief economist George Glynos says the Reserve Bank will have to take its cue from other central banks which have been aggressively cutting rates.
“Fiscal authorities, I don’t expect they going to do much if you asking me if the central banks they will – it’s almost undoubtedly true that they will partly because they have been watching what going on globally and partly also because they are concerned about growth… They will have the room within the inflation basket to reduce rates so it will not surprise me to see not one but several cuts in the coming months from the Reserve Bank.”
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