Central Banks

SAR beginning the latest rate policy statement 18 Jan

  • wage increases to continue to drive inflation
  • The average inflation forecast for 2017 is unchanged at 5.3% but the average forecast has been revised downwards for 2018 & 2019 to 4.9% & 5.4% respectively from 5.2% & 5.5% previously. Inflation is expected to average 5.5% in the final quarter of 2019
  • the rand exchange rate responded strongly to the outcome of the ANC elective conference, and since then has traded in a range of between R12.25 & R12.50 against the US dollar. This is in sharp contrast to the low of R14.47 a month earlier
  • The SARB has revised its forecast for gross domestic product (GDP) growth up from 0.7% to 0.9% for 2017; while forecasts for 2018 & 2019 have been adjusted to 1.4% & 1.6% respectively, up from 1.2% & 1.5% previously.

FYI the actual decision comes at the end not the start but expected to stay on hold at 6.75%

Update: The repurchase rate remains unchanged at 6.75% per annum

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