South African Interest rates patterns

Andre van der Veer (RMB Proprietary Trading & Investments):

Interest rates: What should happen? What is likely to happen? How will they be impacted by the influence of the NEC?

Theoretically what should happen, given the fact that monetary policy makers have one significant instrument amongst the few they can choose from, and given current inflation expectations, interest rates should continue to rise from current levels.

This is a contentious argument with the majority of commentators and analysts making a very fair point that there is precious little that SA interest rates can do about the increasing prices of oil and other commodities such as coal and grains. Even if these increases come to a halt, or recess, that would not tie back to any decision made about local interest rates.

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