Signs point to Bank raising rates by 50 bps on Thursday
Monetary Policy Committee likely to focus on the rand’s recent blowout, inflation that’s at the upper end of its target band and recent wage demands well in excess of CPI
The SA Reserve Bank is likely to raise interest rates by the biggest margin in more than five years on Thursday, economists say, a decision that would confirm the Bank’s hawkish stance on inflation as spiralling fuel and food costs push consumer prices closer to the upper end of its target range.
The Bank, which started a three-day monetary policy meeting on Tuesday is forecast to raise its benchmark repo rate by 50 basis points to 4.75% to keep up with what is now a faster pace of monetary policy normalisation around the world in an attempt to stem capital outflows and ensure foreign participation in the local bond markets. ..