Johannesburg - The South African Reserve Bank (Sarb) would
not raise rates only because of higher oil and food prices, chief economist
Monde Mnyande said on Tuesday.
The bank has left the repo rate unchanged at 5.5% this year,
after reducing it by 650 basis points between December 2008 and December 2010.
The bank has said it expects inflation to briefly breach the
target range of between 3% and 6% and peak at 6.3% in the first quarter of 2012,
mainly due to higher oil and food prices and administered prices.
"The cost-push pressures are the ones that have made
the MPC (Monetary Policy Committee) not to move up on policy rates. We take
into consideration all other prices in the basket and it wouldn't be fair to
look at one variable ... That's not how we do things."
"We will consider all factors that affect
inflation," Mnyande told a breakfast meeting.
The next move in rates is expected to be up, but the market
is so far divided on whether the central bank will start tightening policy in
the fourth quarter or early next year.
Mnyande said the central bank also considered economic
growth and job creation in its deliberations, but the pursuit of low inflation
will always be its primary role.
"Low inflation is in the interest of sustainable
quality economic growth. What the bank does in combating inflation is necessary
in order to have a strong platform from which growth and job creation can take
off and gain momentum."
"We will always target inflation, whatever name it will
be called, we will always strive to keep inflation low," he said.
South Africa's inflation has been inside the Reserve Bank's targeted range since February 2010, partly due to a strong rand that has helped cushion the impact of higher oil and food prices.
The rand has gained nearly 30% against the dollar since the
start of 2009. Mnyande said the rand was not necessarily a threat to economic
growth, a complaint of exporters and some trade unions.