Rand, bonds rally after central bank cuts rates

📆 7/18/2019 8:20 PM
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The rand rallied against the dollar on Thursday and bond yields fell after the central bank cut its main lending rate by 25 basis points in a widely expected move to counter floundering economic growth.

At 1600 GMT, the rand was 0.93% higher at R13.8825 per dollar after closing at R14.0125 in a previous session.

But in a media briefing on Thursday, the bank poured cold water on the long-term impact of lower lending rates, saying the weak economy was linked more to fiscal policies and a rate cut could only have a short term effect. Bonds also crossed a crucial psychological mark, with the yield on benchmark 2026 government bonds dipping below 8% to 7.975%, 5 basis points lower on the day.

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