Reserve Bank governor Lesetja Kganyago said on Thursday an interest rate cut would only be considered once inflation was in the 3%-6% target band. Inflation dipped to within the band in August, but rose to 6.1% year on year in September, Statistics SA data showed this week. Given that inflation is only expected to return to within the target band in the second quarter of 2017, Kganyago’s comments suggest rates will not be cut until at least the second half of 2017. Although the rate-hiking cycle that began in 2014 could be nearing an end, "this does not mean interest-rate reductions are imminent as we would like to see inflation more firmly within the target range on a sustainable basis over the forecast horizon", Kganyago said. The bank’s monetary policy committee is expected to keep rates on hold at its last meeting of the year, in November. Addressing the South African Chamber of Commerce and Industry’s (Sacci’s) annual convention on Thursday, Kganyago also said strong institutio...
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