Reserve Bank walks a tightrope on interest rates
Most economists expect monetary policy committee to hold, while others say weak rand and oil price will force its hand
The SA Reserve Bank will walk a tightrope when it hands down its latest interest rate decision, torn between a worsening inflation outlook and an economy that is in the midst of its first recession in a decade.
While just three of 19 economists surveyed by Bloomberg expect the Bank’s monetary policy committee (MPC) to raise the repo rate, Thursday’s call will be among the most anticipated in 2018, with some analysts saying the rand, higher oil prices and turbulence in emerging markets will force its hand. The rand has dropped more than 7% since the last policy meeting.
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