THE South African Reserve Bank (SARB) governor Lesetja Kganyago on Thursday announced 25 basis points increase in the repo rate, taking the key rate that it lends to commercial banks to 4%.
Addressing the media following the MPC’s meeting, Kganyago said in the near term, headline inflation had increased well above the mid-point of the inflation target band, and returns close to the mid-point in the fourth quarter of 2022.
Four members of the Committee preferred an increase and one member preferred an unchanged stance.
He said: “Some risks to the inflation outlook, like food and fuel, have been realised, and other risks, such as currency volatility and capital flow reversals, have become more pronounced. He said this year and next, economic growth would remain well above a low rate of potential growth.
The bank has also warned that the higher food, fuel and energy prices will keep inflation
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