SARB confounds expectations with half-point hike

The South African Reserve Bank raised its policy rate to 12% on Thursday.

Markets had expected a 100 basis-point rise on the back of hawkish comments from Tito Mboweni, the governor of the Reserve Bank, last week. But the Reserve Bank's rate-setting committee opted for a half-point hike, saying that there were "a number of offsetting effects which confirm the responsiveness of the economy to our less accommodative monetary policy stance."

Monetary-policy relevant inflation would soar from 10.