Sarb raises rate 25bp now to avoid bigger move later
Shocks of a "persistent nature" spur central bank to raise rate
The South African Reserve Bank (Sarb) raised its policy rate by 25 basis points to 6.25% today (November 19), amid fears "shocks of a persistent nature" would force the central bank into a larger move if it postponed action.
Annual inflation ticked up to 4.7% in October. Despite only marginal changes in the inflation forecast, the MPC deemed the upside risks to the outlook to be "more pronounced".
"In the absence of demand pressures, the monetary policy committee had to decide whether to act now
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