THE BAD

Finweek English Edition - - THE WEEK -

Con­sumer price in­fla­tion (CPI) in­creased to 6.5% year-on-year in Oc­to­ber, above mar­ket ex­pec­ta­tions of 6.3%. CPI is ex­pected to move no­tice­ably higher over the next two months, ac­cord­ing to Stan­lib, but is ex­pected to fall back within the Re­serve Bank’s tar­get range of 3% to 6% in the first half of 2017. The bank could af­ford to leave rates un­changed in the short term (a de­ci­sion was ex­pected on 24 Novem­ber, af­ter fin­week went to print), with some scope for rate cuts in late 2017, Stan­lib said. How­ever, this will be “sig­nif­i­cantly im­pacted” by changes in US in­ter­est rates as well as any down­grades in South Africa’s credit rat­ing, it said.

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