Economists forecast another hold on the repo rate when MPC wraps July meeting
The highly anticipated announcement on Thursday, follows several decisions to keep the repo rate unchanged at 8.25%.
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JOHANNESBURG - Some economists have forecast another hold on the repo rate when the Monetary Policy Committee (MPC) wraps up the July meeting on Thursday.
The central bank’s MPC met this week to decide on the country’s policy rates.
The highly anticipated announcement follows several decisions to keep the repo rate unchanged at 8.25%.
Inflation has remained in the South African Reserve Bank (SARB)’s target band of 3% and 6% for 12 consecutive months.
But this alone is not enough to sway the MPC to start the easing cycle.
Wits Business School Professor Jannie Rossouw has warned inflation expectations are still pushing up, adding risks to the outlook.
“My expectation is that the reserve bank will keep the repo rate unchanged because the inflation expectations are not coming down.”
Economist at Sanlam Investments Patrick Buthelezi agreed.
“The key things we’ll be looking out for is the inflation outlook, the projection of the repo rate from the QPM [quarterly projection model], and importantly the voting patterns of the MPC members.”
The announcement is expected at 3pm.