South African Markets Cheer as Central Bank Injects Liquidity
- Equity index jumps most on record, rand bond yields plunge
- Liquidity measures come day after biggest rate cut in a decade
The South African Reserve Bank, right, stands on the skyline in Pretoria.
Photographer: Waldo Swiegers/BloombergThis article is for subscribers only.
South Africa’s central bank announced measures to inject liquidity into local markets, a day after cutting its benchmark policy rate by 100 basis points as the coronavirus outbreak risked plunging the economy into a prolonged recession.
The benchmark stock index rose by the most on record, yields on benchmark government bonds fell and the rand extended gains. The measures are aimed at supporting interbank lending and freeing up cash in the money markets in response to “liquidity strains,” the Pretoria-based South African Reserve Bank said in a statement.