JOHANNESBURG (Reuters) – The South African central bank further cut its government bond purchases in July, buying 2.5 billion rand ($142 million) worth, or half the amount it bought in June, to bring its total holdings to 38.4 billion rand, data showed on Friday.

Rampant selling of government debt in March and April, as the coronavirus struck, forced the bank into emergency liquidity measures, including a quantitative easing style purchase of bonds in the secondary market.

At its rate meeting two weeks ago, when the bank clipped lending rates by 25 basis points, governor Lesetja Kganyago stressed the bond buying was to support liquidity rather than finance government’s ballooning budget deficit.

In May, National Treasury upped the weekly amount of debt on auction by nearly 2 billion rand.

Local banks and asset mangers have mostly taken up the increased supply, but foreign investors have reduced their holdings to an eight-year low at 30.1%.

($1 = 17.5639 rand)