South Africa’s central bank announced on January 28, it has raised benchmark rate by half a percentage point to 6.75% in an attempt to contain inflation and slow Rand slump against US dollar.

“Given the deterioration in the inflation outlook, the MPC decided to increase the repurchase rate by 50 basis points to 6.75% per annum, effective from 29 January 2016,” said the central bank’s governor, Lesetja Kganyago, during a press conference. “Rand depreciated significantly as a result of changes on both the national and international levels and drought which is increasingly growing severe cease not to boost prices of food products,” he added.

Rand depreciated more than 30% against dollar since the beginning of 2015. The South African currency also slumped 6% against the dollar since January 1^st, 2016.

Already suffering from a decreasing household consumption, power outages, falling prices of commodities, and slowdown of Chinese demand, South Africa’s economy has been experiencing severe droughts for more than century now. As a result, the central bank scaled down its forecasts for inflation to 6.8% in 2016 against 6% previously. In 2015, inflation rate was 4.6%.

The Reserve Bank which previously raised its repurchase rate by 25 basis points at the end of November 2015, now projects a growth rate of 0.9% for 2016 against 1.3% in 2015.