Anglican Church of Southern African

Monthly Investment Report - Retirement Fund

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May 2020

South Africa continued its extended lockdown but softened the extent slightly in May as a limited number of additional sectors of the economy were allowed to open. President Ramaphosa continued to indicate that, although the country has been able to dampen the infection rate, the pandemic will get much worse
before it gets better.

The South African Reserve Bank gave consumers some respite, producing a further 50bp rate cut bringing the repo rate to 3.75%. With inflation likely to remain in the lower half of the target band, the Bank might be in a position to
cut rates further. However, SARB Governor Lesetja Kganyago did not strike a particularly dovish tone and indications are that the Reserve Bank will take a wait-and-see approach before moving rates again.

This was, however, the extent of the positive news as economic data continued to show the devastating effect of the lock-down on the economy. SA recorded a massive trade deficit as imports plunged.

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