Following dovish comments from the US Federal Reserve last week, close attention will be paid to this year’s first meeting of the SA Reserve Bank’s monetary policy committee (MPC) this week. Economists will also be watching to see whether data from Stats SA points to a continued recovery in the economy after SA exited its first recession since the global financial crisis in the third quarter. After hiking the repo rate by 25 basis points for the first time in two years to 6.75% at its November meeting, economists expect the MPC to keep the policy rate steady when it announces its decision on Thursday. “The underlying growth and inflation dynamics still support a neutral monetary stance,” says Nedbank senior economist Nicky Weimar. The lower oil price and a R3-per-litre decline in the petrol price will most likely see the Bank revise its inflation projections lower, says FNB chief economist Mamello Matikinca.

“This should be sufficient to convince the Bank MPC to leave interest...

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