South Africa

South Africa Monetary Policy November 2022

South Africa: SARB continues to tighten policy aggressively in November

At its 24 November meeting, the Monetary Policy Committee of the South African Reserve Bank (SARB) increased the repurchase rate by a further 75 basis points, bringing it to 7.00%. The move, which came on the heels of Septembers same-size increase, had largely been priced in by markets. The decision regarding the size of the hike—the seventh consecutive increase since November 2021—was once again contested: Two of the five members preferred a 50 basis point increase.

The move was driven by the Banks assessment that risks to the inflationary outlook remain skewed to the upside. The SARB sees headline inflation returning to its 3.0–6.0% target band in H2 2023, but still upwardly revised its headline inflation forecasts for 2022 and 2023 to 6.7% and 5.4%, respectively, amid higher price expectations for local food and electricity. Additionally, core inflation forecasts for 2023 were also upwardly revised to 5.5%.

With regard to future policy moves, the SARBs tone remained hawkish but vague. It reiterated its commitment to stabilize and anchor inflation expectations around the midpoint of its target range. Meanwhile, the Bank noted that “economic and financial conditions are expected to remain more volatile for the foreseeable future,” and that, therefore, “monetary policy decisions will continue to be data dependent and sensitive to the balance of risks to the outlook”.

The next monetary policy meeting is scheduled for 24–26 January 2023.

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest