Ramaphosa says repo rate is 'inordinately high'
November 18, 2009
By Ethel Hazelhurst
Reserve Bank Governor Gill Marcus faces pressure from several quarters to cut rates.
The latest voice to join in the chorus belongs to Cyril Ramaphosa, an executive chairman of Shanduka Group, who is also a member of the ANC national executive committee.
In an interview with Bloomberg yesterday, ahead of the MPC announcement, he described domestic interest rates as "inordinately high".
He called for the repo rate to be cut to about 5 percent from 7 percent and argued in favour of a weaker rand.
Shanduka has major investments in resources and suffers when rand strength erodes miners' offshore earnings.
According to Ian Cruickshanks, the head of strategic research at Nedbank Capital, the currency responded to his comments by falling from R7.35 to the dollar to R7.45 within minutes of the news appearing on the wires.
A few weeks ago Cosatu, which has long demanded rate cuts, told Parliament the repo rate should be as low as 3 percent. - Ethel Hazelhurst
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