South Africa’s central bank raised interest rates by three-quarters of a percentage point for a second straight meeting, fully unwinding its extraordinary pandemic-era stimulus measures.
The monetary policy committee raised the repurchase rate to 6.25% from 5.5%, Governor Lesetja Kganyago said Thursday in an online briefing. The move returns the benchmark to its January 2020 level — before stop-start coronavirus lockdowns, and supply-chain disruptions prompted unprecedented easing.
It also aligns the South African Reserve Bank with its counterparts around the world that are unleashing the most aggressive monetary policy tightening in decades to combat the worst global inflation shock in a generation.
Of the five members on the panel, three voted for the 75 basis-point increase, and two preferred a 100-basis-point hike.
South Africa’s rand held gains after the central bank’s decision. The currency gained 1% to 17.5744 per US dollar as of 3:16 p.m. in Johannesburg. Yields on benchmark government debt extended their decline, falling 7 basis points from Wednesday’s close to 10.89%.