CEFA Repo rate

Johannesburg, 19 March 2020 – The Steel and Engineering Industries Federation of
Southern Africa (SEIFSA) welcomes the South African Reserve Bank’s decision to cut
the repo rate by 100 basis points to 5.25 percent, the Federation’s Economist, Marique
Kruger, said this afternoon.

Speaking after the Governor’s announcement, Ms Kruger said the lowered interest rate
is encouraging and has the potential of stimulating consumer demand and boosting
production towards better growth.

“The decision provides some relief for businesses which continue to operate in a tough
economic environment, underpinned by non-descript domestic growth, subdued demand,
high unemployment, volatile output, high unit labour costs and poor business activity
levels,” Ms Kruger said.

She added that the monetary policy intervention is welcome, especially given the negative
Gross Domestic Product growth in the third and fourth quarters of 2019, which effectively
catapulted the South African economy into a technical recession. The decision by the
Reserve Bank is likely to stimulate demand and improve an ever-weakening domestic

Ms Kruger said the lowered interest rate will benefit key industries which are drivers of
domestic demand and supply patterns for the metals and engineering sector, in the
process boosting overall demand for its intermediate products.

Moreover, it would help struggling companies to mitigate production costs, offset volatile
petrol prices and losses arising from costly intermediate imports, while also providing a
basis for an improved differential for businesses faced with fluctuating selling price


Issued by:
Ollie Madlala
Communications Consultant
Tel: (011) 298 9411 / 082 602 1725

SEIFSA is a National Federation representing 21 independent employer
Associations in the metals and engineering industries, with a combined
membership of 1600 companies employing around 200 000 employees.
The Federation was formed in 1943 and its member companies range
from giant steel-making corporations to micro-enterprises employing
fewer than 50 people.