Reserve Bank keeps interest rate unchanged
The Reserve Bank has left the interest rate unchanged at 5.75%.
Announcing the decision after a meeting of the Reserve Bank’s monetary policy committee yesterday, governor Lesetja Kganyago said consumer inflation was expected to average 3.8% this year (revised down from 5.3%) and 5.4% next year.
“Having averaged 6.1% in 2014‚ inflation is now expected to average 3.8% in 2015‚ compared with the previous forecast of 5.3%‚ and to reach a low of 3.5% in the second quarter of this year, compared with 5.1% previously.
“The steep decline in 2015‚ however‚ produces a strong base effect in 2016‚ and‚ when combined with a slightly higher oil price assumption and depreciated nominal effective exchange rate of the rand‚ results in an average inflation forecast of 5.4% for the year (5.5% previously)‚ and 5.3% in the final quarter‚” he said.
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