The Reserve Bank’s monetary policy committee (MPC) kept the interest rates unchanged, as expected, on Thursday. The repo rate therefore remains at 6.75%. All 18 economists polled by Bloomberg expected the decision. “Since November 2018, international developments have been the major contributor to an improved inflation outlook. Significant declines in international oil prices and a less depreciated exchange rate have been key drivers of the improved outlook,” Reserve Bank governor Lesetja Kganyago said. Inflation is expected to moderate this year but the Bank has made it clear it would prefer inflation anchored at the midpoint of the 3% to 6% target range. Inflation is expected to average 4.8% in 2019. The Bank forecast the the following path for inflation: • 2018: 4.6%, from 4.7% at the November meeting • 2019: 4.8, from 5.5% in November • 2020: 5.3%, from 5.4% in November • 2021: 4.8% Inflation is now expected to peak at 5.6% in the third quarter of 2018. GDP growth is expected to...

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