Reserve Bank Keeps Interest Rates Unchanged At 7%

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Published Nov 26, 2016

South Africa's central bank has kept its benchmark repo rate unchanged at 7 percent, in line with market consensus. However, it's warned that risks to the inflationary outlook have increased. Delivering the last scheduled rate decision for the year, central bank Governor Lesetja Kganyago said food price inflation was expected to moderate at a slower pace than previously forecast. The bank has kept the benchmark rate on hold at its last four meetings. It has raised the rate by a cumulative 200 basis since early 2014, in a bid to rein in inflation. The bank forecasts for inflation in 2016 remained unchanged from September's meeting at 6.4 percent. It forecast consumer prices peaking at 6.6 percent in the fourth quarter before moderating in the second half of 2017 due to improved weather conditions.