South African Reserve Bank to hike rate 75 bps to 6.25% on Sept. 22

SOUTH Africa’s central bank will raise its key interest rate by 75 basis points next week to brake inflation, a Reuters poll found, adding another 25 basis points in each of the following two quarters before pausing for the rest of 2023.

A majority of economists in a Sept. 7-14 poll, 12 of 20, predicted another 75 basis points to 6.25% at its Sept. 22 meeting following a similar move in July. The remaining eight expected a smaller half-point move.

The South African Reserve Bank has raised its main lending rate ZAREPO=ECI by 200 basis points so far in this cycle. Read full story

“We still expect the SARB to keep its foot firmly on the hiking pedal,” said Jeffrey Schultz at BNP Paribas, who like the majority expects a 75 basis point move, adding: “evidence of broader price pressures should yield another hawkish statement.”

Thereafter, the SARB is due