The announcement follows Thursday’s virtual MPC meeting during which two members of the committee preferred a 25-basis point cut and three preferred to hold rates at the current level.
According to the meeting, the growth rate for 2020 was now expected to be -7.1% compared to the negative growth of 8.0% expected at the time of the November 2020 meeting, he said.
“However, our projection for the 4th quarter of 2020 is expected to be lower than previously forecast.
“And while lockdown restrictions currently in place are considerably less restrictive than in 2020, we expect growth in the first quarter of 2021 to remain muted,” the governor said.
The gross domestic product (GDP) was now expected to grow by 3.6% in 2021 and by 2.4% in 2022, with the GDP growth of 2.5% expected in 2023, he said.
Kganyago noted that the second wave of coronavirus infections is expected to continue “until vaccine distribution is widespread and populations develop sufficient immunity to curb virus transmission.”
“Although the virus will continue in new waves, the rollout of vaccines is expected to boost global growth prospects generally. We have therefore revised global growth for 2021 to be higher,” the top banker said.
However, global distribution of vaccines was likely to be slow -- creating an uneven pace of global economic recovery in 2021, Kganyago said.