Despite keeping rates unchanged, the Reserve Bank says its fight against inflation is not over.
- Sarb Governor Kganyago said the bank is “ready to deploy our tools to tackle this monster that is eating the income of South Africans.”
- The MPC decided to keep the repo rate at 8.25% after 10 consecutive hikes since November 2021.
- Kganyago said the rate hold does not mark the end of the hiking cycle and the bank remains ready to act if risks materialize.
- The Sarb now expects the economy to grow 0.4% in 2022 and sees inflation averaging 6% this year, falling to 5% in 2024 and reaching the midpoint target in 2025.
- Economists say the Sarb is being cautious by not committing to more hikes but wants to hedge against potential risks.
- The ANC has called on Finance Minister Godongwana to pressure the Sarb to review its inflation-fighting methods.
- Economists say the Sarb has retained its autonomy and is committed to its mandate of ensuring price stability above all else.