SA’s surprise deficit stirs rate-cut hopes
The Reserve Bank may remain cautious due to political and global risks to the rand and inflation outlook
SA’s current-account deficit has fallen unexpectedly steeply, supporting a stronger rand and adding to hopes in the market that the Reserve Bank might start cutting interest rates later in 2017. But economists are divided, with many expecting that the Bank, whose monetary policy committee meets next week, will remain cautious in the light of political and global risks to the rand and the inflation outlook. They will be updating forecasts following the release on Wednesday of the Bank’s Quarterly Bulletin and of Statistics SA’s consumer price index inflation figures, which showed inflation declining to 6.3% in February, in line with market expectations, from 6.6% in January, with food inflation falling to just less than 10%. If you are already a subscriber, please click on the following link below to go to the full article: Surprise deficit dip stirs rate-cut hopes If you would like to subscribe to BusinessLIVE Premium to read the full story, please click here: Subscribe
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