THE South African Reserve Bank will hike its repo rate to 4.25% next week to try to slow inflation, according to a Reuters poll of economists who said prices could rise faster than they had expected before Russia’s invasion of Ukraine.
Fifteen of 19 economists polled in the last week predicted the repo rate would rise by 25 basis points to 4.25% on March 24, while the remaining four said it would be left unchanged.
The poll predicted inflation would average 5.5% this year, up from last month’s survey consensus of 5.0% and near the top of the SARB’s 3-6% target range. It is forecast to average 4.4% in each of the following two years.
However, eight of nine economists who answered an additional question said there was a high risk of further upgrades to medium-term inflation forecasts in the coming months.
“Supply challenges and bottlenecks that faced the globe
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