South Africa: SARB to keep its policy rate on hold today - TDS

In line with the unanimous consensus, analysts at TD Securities are expecting the SARB to keep its policy rate on hold at 6.75% today.

Key Quotes

“The MPC will be reasonably happy with developments since the November meeting. The rand has been fairly stable both against the US dollar and also on a trade-weighted basis. Brent crude has fallen in US dollar terms by 2.5% and at the current level of $61/bbl lies comfortably below the SARB's 2019 assumption of an average of $73/bbl.”

“At the November meeting the MPC narrowly decided to hike by 25bps, even though their revised forecasts showed a lower inflation peak in 2019 than the prior ones. So we see little reason for the MPC to do anything today. We expect the tone of the statement to be broadly unchanged with the MPC continuing to see the risks to the longer-term inflation outlook as being to the upside.”