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Why SA won't see interest rate cuts soon

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Johannesburg – With low growth and the expectation of higher inflation, the South African Reserve Bank (Sarb) is likely to keep the repo rate unchanged at its next Monetary Policy Committee (MPC) meeting next week, said an analyst.

In a statement Nomura emerging markets economist Peter Attard Montalto explained that it is likely that interest rates are to remain unchanged. However, the Sarb may be “hawkish” following the inauguration of US President-elect Donald Trump.

At the last MPC meeting in November, Reserve Bank Governor Lesetja Kganyago highlighted the concerns of a stronger dollar and the impact of interest rate hikes by the Federal Reserve Bank (Fed).

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