Economics
South Africa Raises Benchmark Rate to 7% as Political Crisis Roils Rand
- Committee was split on whether to increase borrowing costs
- Inflation accelerated to 17-month high of 6.2% in January
This article is for subscribers only.
South Africa’s central bank raised its benchmark interest rate for a second time this year in a decision that split the Monetary Policy Committee and as a political crisis engulfing the country hurts the currency.
The repurchase rate was increased to 7 percent from 6.75 percent, Governor Lesetja Kganyago told reporters on Thursday in the capital, Pretoria. Half of the 30 economists surveyed by Bloomberg forecast the rate will stay unchanged, 14 expected a 25 basis-point increase and one predicted 50 basis points. Three of the six MPC members favored a quarter-point increase, while the rest favored no change, the governor said.