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Johannesburg - South Africa's central bank will meet on March 23-24 to decide on interest rate movements, four weeks ahead of its previously scheduled April meeting, the Reserve Bank said on Wednesday.
The bank said in a statement on its website it had changed meeting dates for the rest of 2009, with the monetary policy committee (MPC) meeting every month, except for July.
The MPC previously met every two months.
Brait economist Colen Garrow said the only reason the SA Reserve Bank had called an early meeting was to announce a rate cut, where he expected a cut of 100 basis points.
"Markets were becoming disillusioned with the comments governor Mboweni made, shortly after the MPC meeting in February, that if GDP data were poor, the bank would convene an early meeting of its MPC. Then, in an apparent about-turn a few weeks ago, the governor poured cold water on these expectations, even though fourth-quarter 2008 growth in domestic output contracted by 1.8%, the first seasonally adjusted contraction since 1998, and the largest since 1992.
Garrow said the bank is staying tight-lipped on the reason for the meeting, but "the obvious guess is that it wants to cut rates".
"Not only is the SARB lagging the monetary easing seen in many G20 economies, but the slow response to easing rates compromises the delicate balance between recession and recovery. Annual growth in vehicle sales has contracted for twenty-three consecutive months. And, annual growth in retail sales is little better, having contracted for eight months in a row."
- Reuters & Fin24.com