Reserve Bank leaves rates unchanged, with inflation risk slightly higher
Governor Lesetja Kganyago says the bottom of the growth cycle is probably behind us
The Reserve Bank held interest rates steady, as widely expected, on Thursday. Thursday’s decision left the repo rate unchanged at 7%. The Bank has raised rates by 75 basis points since the start of the year, and by 200 basis points since January 2014. The last rate increase was 25 basis points in March 2016, and followed a 50-point hike in January. Announcing the decision of the monetary policy committee, Bank governor Lesetja Kganyago highlighted heightened global uncertainties, following the election victory of Donald Trump, and its implications for emerging markets and the rand. He said the outlook for inflation and growth had not changed much, though the risk for inflation was slightly higher, with food inflation again driving both producer and consumer inflation higher in October. Food inflation was expected to peak only in early 2018. Oil prices were expected to continue rising, and Kganyago pointed to an 88c a litre rise in the petrol price over October and November. Growth r...
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