Reserve Bank expected to leave repo rate unchanged
THE Reserve Bank is expected to leave interest rates unchanged at its meeting today, according to a Reuters poll released on Monday, but economists expect a dovish statement as the bank gets closer to its easing cycle.
Twenty-four of 27 economists said the Reserve Bank will hold rates at 7% today. Two predicted a 25basis-point cut and one expects the repo rate to be cut by 50 basis points.
Economic growth in South Africa will be weaker this year after the country slipped into recession in the first quarter, and with inflation easing an interest rate cut is expected in the first quarter of next year.
“While our consumer price index view indicates that the bank has room to ease rates from as early as next week, it will first look to change its inflation rates narrative before pulling the trigger,” BNP Paribas economist Jeffrey Schultz said last week. — Reuters