The Net’s excited over Cassie’s reported pregnancy but worried about Diddy

1. Yesterday was a day of high drama. First, president Cyril Ramaphosa at last commented on the high-level disagreement in the ANC about the Reserve Bank’s independence, and quantitative easing.

He issued a statement that reaffirmed the mandate of the SA Reserve Bank.

Then ANC secretary general Ace Magashule posted on Twitter that the party’s NEC lekgotla had resolved to expand the mandate beyond price stability to include employment and growth. He swiftly deleted his tweet, claiming that his account was hacked.

Even Jacob Zuma entered the fray:

2. While all of this was going on, the rand crashed through R15/$ for the first time in eight months.

This morning it was slightly firmer, if that’s any consolation. 

3. Moody’s – the only credit rating agency that still reckons South Africa isn’t junk – is now predicting that the country will slip into recession in the second quarter.

4. South Africa’s current account deficit (which shows there is more money leaving the country than there is coming in) grew to 2.9% of GDP in the first quarter, from a 2.2% shortfall in the fourth quarter of the previous year. It was still better than economists expected.

5. Former managing director Rod Humphris, now chairman, of the crisis-ridden chemicals group Omnia has stepped down. Investors reacted with fury last week after the chemicals company announced a rights issue of R2 billion – after ruling out the option in April.

The company is struggling with a debt burden of R2.7 billion due to a string of pricey acquisitions.  

How SA interest rates compare to the rest of the world

Charlie Bilello, director of research at investment group Pension Partners, put together a comparison of global interest rates – showing that South Africa still offers one of the highest rates in the world.

The repo rate is currently at 6.75% – compared to Brazil (6.50%), China (3.00%) the US (2.38%) and Australia (1.25%). 

Yesterday, India cut its interest rate to the lowest level in nine years, to 5.75%. After inflation, its interest rate is 2.9%. South Africa’s “real” interest rate is 2.4%.

It is expected that the SA Reserve Bank will cut rates in July, given that we are heading for a recession. But others are also preparing to cut: the Fed may consider lowering rates as early as June. 

Business Africa.

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