South African Reserve Bank Keeps 7.0%Repo Rate As Forecast

January 26, 2010

A statement from South Africa’s central bank looks for sustained in-target CPI inflation from this March through end-2011 with evenly balanced risks.  Positive growth resumed in the third quarter, but GDP remains below year-earlier levels.  CPI inflation decelerated from 6.1% in September to 5.8% in November, and producer prices have been lower than a year ago.  The Reserve Bank cut rates aggressively when the brunt of the recession struck, flanking four reductions of 100 basis points last February, March, April and May with cuts of 50 bps in December 2008 and August 2009.  Policy has not been changed further since August.

Copyright Larry Greenberg 2010.  All rights reserved.  No secondary distribution without express permission.

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