Analysts at TD Securities think the SARB rate decision today is a close call and that is reflected in the Bloomberg survey with 11/21 respondents expecting a 25bps hike, and the rest expecting no change.
Key Quotes
“There have been some positive events since the September MPC meeting with the rand strengthening by 4.5% on a trade-weighted basis and Brent crude down 22% in rand terms. However, the MTBPS has increased the risks of Moody’s moving its ratings outlook soon to negative prior to an eventual downgrade to sub-investment grade.”
“And the September forecasts showed headline inflation peaking at 5.9% in Q2 2019, near the top of the 3-6% target range. With a close vote at the September meeting, on balance we think a cautious MPC will err on the side of caution and hike by 25bps.”
Share
