In light of the downward trajectory of inflation in recent months and the expectation of such a downward trend to continue in the next few months to levels well below the 4.5% midpoint of the inflation target, it was predictable that the Reserve Bank would feel obliged to reduce the repo rate for the first time in four years.

This is precisely what transpired, with the repo rate being reduced by 0.25% to 8.00% from the 8.25% level that had prevailed for 18 months.