monetary policy
What’s behind the Reserve Bank’s pivot?
If anyone doubted the resolve of the Reserve Bank to keep a lid on inflation, last week’s 75 basis-point rate hike would have dispelled it. But what caused the Bank to turn so hawkish and can such a steep hike be justified, given the weakness in SA’s economy?
28 July 2022 - 05:00
At the end of June, Reserve Bank deputy governor Kuben Naidoo seemed sanguine about SA’s interest rate outlook, stating in a live interview with Citibank that recent developments probably warranted only “a slight change” in the pace of monetary policy tightening.
The economy was weak, he said, there was scant evidence of second-round effects, core inflation remained below the midpoint and headline inflation was expected to peak soon and then fall rapidly...
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