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Sarb repo rate move the calm before the storm - as it happened

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SARB governor Lesetja Kganyago.
SARB governor Lesetja Kganyago.
Last Updated

23 Sep 2015

Sizwe Nxedlana, chief economist at FNB: The recent performance of the SA economy has deteriorated further. South Africa’s short-term growth outlook is also not rosy with domestic demand likely to face strong headwinds.  The lower oil price since the last Monetary Policy Committee meeting has also improved the outlook for headline inflation while core inflation has been moderating. The major risk to the inflation outlook is the weakness of the exchange rate and its potential second round effects on firm pricing behaviour.

23 Sep 2015

Clive Ramathibela Smith from Inkunzi Investments on CNBCA: We still have not come to the issue of how to sort out the job situation in SA. I think next Sarb rate hike will be in November.

23 Sep 2015

FNB CEO Jacques Celliers: In an environment of low economic growth and high volatility in currency and equity markets which are creating unwanted uncertainty, the SARB’s cautious approach is prudent. Naturally, we are seeing increased consumer caution in the second half of 2015.

23 Sep 2015

FNB CEO Jacques Celliers: Following the decision by the US Federal Reserve to keep rates unchanged last week, today’s announcement was widely expected. The Fed’s decision to delay the start of its interest rate hiking cycle has bought time for the SARB to delay its own hiking cycle.

23 Sep 2015

First National Bank (FNB) will leave its prime lending rate unchanged following the decision taken earlier today by the SARB Monetary Policy Committee (MPC) to keep rates on hold until the final SARB MPC meeting of 2015.

23 Sep 2015

Clive Ramathibela Smith from Inkunzi Investments on CNBCA: We do not want the situation where we are literally at zero growth.

23 Sep 2015

Kay Geldenhuys, ooba manager for property finance processing: The decision is a great relief to South African property owners who are facing increasing financial strains.   The relatively low interest rate environment that currently still prevails is good news for the residential housing market as it gives prospective homebuyers an opportunity to acquire property and secure homeloan finance at an affordable cost of credit. The South African property market outlook for the last quarter of 2015 remains favourable with steady, although slower, house price growth, relatively low interest rates and continued lenders’ confidence.

23 Sep 2015

A Reuters poll this week showed 28 of 31 economists expected the repo rate to remain unchanged, saying the South African Reserve Bank would likely wait until November to lift interest rates, amid concerns about sluggish growth. Only two analysts forecast a 25 basis point increment this week, while one predicted a 50-basis-point hike. - Reuters.

23 Sep 2015

The MPC's GDP forecast (real GDP in brackets) for 2015 to 2017:

<p>The MPC's GDP forecast (real GDP in brackets) for 2015 to 2017:</p><p></p>

23 Sep 2015

The MPC's headline (in white) and core (in grey) inflation for 2016 and 2017:

<p>The MPC's headline (in white) and core (in grey) inflation for 2016 and 2017:</p><p></p>

23 Sep 2015

Alex Smith FNB on on SABCN: I think still lot of risk to current account, therefore.

23 Sep 2015

Alex Smith FNB on on SABCN: We need to export more volume. But our ability to export more is constrained due to electricity and labour issues, for instance and low prices make an impact.

23 Sep 2015

Alex Smith FNB on on SABCN: Perhaps MPC knows something or perhaps it is waiting to hear forecasts in upcoming mini budget.

23 Sep 2015

Alex Smith FNB on on SABCN: If Treasury is going to cut its growth forecast in upcoming mini budget, there might be implications for tax revenue and might create expectation of tax increases.

23 Sep 2015

Alex Smith FNB on on SABCN: I think if GDP growth had been higher at this stage, MPC would have been more likely to hike today.

23 Sep 2015

Economist Collen Garrow on SABCN: Eyes now on Finance Minister Nene's upcoming mini budget in October.

23 Sep 2015

READ THE FULL SARB STATEMENT:

MPC Statement 23 September 2015

23 Sep 2015

DebtBusters CEO Ian Wason: This is just the calm before the storm. SA consumer’s still not in the clear despite unchanged repo rate.

23 Sep 2015

Economist Collen Garrow on SABCN: Interest rate hike in December is now more on the cards than ever.

23 Sep 2015

Governor Lesetja Kganyago said: "The combination of sharply slowing growth and rising inflation compounds the dilemma facing monetary policy."

23 Sep 2015

Alex Smith FNB on on SABCN: US has not hiked interest rates in 9 years so we do not know what a US hike would do to the markets, we would have to wait and see.

23 Sep 2015

Here's how the rand is looking now:

<p>Here's how the rand is looking now:</p><p></p>

23 Sep 2015

Alex Smith FNB on on SABCN: Once Fed hikes we could se another bout of rand weakness.

23 Sep 2015

Samuel Seeff of Seeff Properties: It is an interesting time for the market, he adds. Although activity has slowed, there is no slump on the horizon. Yes, demand and price growth is down year-on-year, but this is to be expected. This notwithstanding, activity in the primary sector and some secondary markets is still at better levels compared to five years ago.

23 Sep 2015

Andrew Golding of Pam Golding Properties: While the recent interest rate increase will take some months for its impact to filter through and take effect, what we are currently seeing is a market which remains characterised by a shortage of stock and abundance of buyers and which has performed well for the year to date despite a range of economic challenges. Mirroring the trend of high demand and stock shortages, the rental market remains buoyant in all sectors and price segments across the country.

23 Sep 2015

DebtBusters CEO Ian Wason: “No change in the repo rate comes as a great relief, but consumers must not think they are in the clear just yet. The recent poor performance of the Rand against other major currencies as well as a drought that has pushed the agricultural sector into a recession in the second quarter of this year, means that food price hikes are expected. Consumers are going to end up paying more for staples such as maize, meat, eggs and dairy products.”

23 Sep 2015

Kganyago: No change in the repo rate comes as a great relief, but consumers must not think they are in the clear just yet. The recent poor performance of the Rand against other major currencies as well as a drought that has pushed the agricultural sector into a recession in the second quarter of this year, means that food price hikes are expected. Consumers are going to end up paying more for staples such as maize, meat, eggs and dairy products.”

23 Sep 2015

Kganyago: Inflation risks from the drought conditions have been seen coming through in data released today.

23 Sep 2015

Kganyago: We cannot form a view on electricity prices until Nersa decides - probably next year.

23 Sep 2015

Andrew Golding of Pam Golding Properties: Many felt that the recent increase of 25 basis points implemented following the previous committee meeting in July was premature, especially given South Africa’s weak economic growth. With inflationary pressures stemming from external factors, including rand weakness, drought and state administered prices, a further interest rate hike would do little to contain these price pressures, but would rather negatively impact much-needed economic growth.

23 Sep 2015

Kganyago: Private sector economists have the luxury to be able to change their opinions any time - not our Sarb economists.

23 Sep 2015

Kganyago: We expect we will be out of target in at least 2 quarters next year - regarding inflation.

23 Sep 2015

Kganyago: Our decision in July to hike was the right decision. Just as the one of today is the right decision as each one is underpinned by rigorous analyses of outlook of SA economy.

23 Sep 2015

Kganyago: We watch data carefully, always.

23 Sep 2015

Samuel Seeff: This MPC decision not to increase should be seen as the appropriate decision for the economy and property market right now. In any event, the July rate hike did little to stem inflation or protect the rand that went into freefall soon after the announcement.

23 Sep 2015

Home buyers with mortgages or seeking credit will have greeted with relief the news that the Monetary Policy Committee meeting today announced its decision to keep the repo rate steady at six percent instead of implementing a further hike, says Dr Andrew Golding, chief executive of the Pam Golding Property group.

23 Sep 2015

REACTION:

The decision by the Reserve Bank’s Monetary Policy Committee (MPC) to retain the repo rate at 6% (basic mortgage loan rate of 9.5%) is, while not unexpected, nonetheless a most welcome move according to Samuel Seeff, chair of the Seeff group. This follows on the good news that inflation has held steady at 4.6%.

23 Sep 2015

Kganyago: Our decisions are more about impacts on SA economy.

23 Sep 2015

Kganyago: We have a policy whereby we do not have to move step by step with US Fed.

23 Sep 2015

Kganyago: MPC did move in July without the Fed - we watch what happens in the world and we always look on what is the impact on SA economy in terms of growth and inflation outlook.

23 Sep 2015

Kganyago: Next MPC is in November so wait until then to see if increase or not.

23 Sep 2015

Jacques du Toit, Senior Economist at Absa, reacts to news: The forecast is for interest rates to be hiked at the last MPC meeting of the year in November and through 2016 in an attempt to contain mounting inflationary pressures from a depreciating rand exchange rate. Currently debt repayments will remain unchanged, which will be a relief to indebted consumers. Banks will continue to monitor economic and consumer-related trends in decisions regarding risk appetite and lending criteria.

23 Sep 2015

Kganyago: MPC will not hesitate to act if risks to inflation outlook deteriorates.

23 Sep 2015

Kganyago: MPC decided to keep repo rate unchanged for now.

23 Sep 2015

Kganyago: MPC regards overall risks to inflation to be on the up side.

23 Sep 2015

Kganyago: Downside risk to inflation outlook includes low oil prices.

23 Sep 2015

Kganyago: Rand likely to react further if Fed moves on interest rates.
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