The Reserve Bank governor says there are numerous pressures on inflation, but it will still decline slowly for the next three years, as it has since 2017.
The South African Reserve Bank’s monetary policy committee on Thursday kept the repurchase rate unchanged at 6.75 percent in a contested decision.
Kganyago said three members preferred to keep rates on hold and two members preferred a cut of 25 basis points. He said the main drivers of the forecast were a lower starting point for food and services inflation, and the revised oil price assumptions. Food price inflation is now expected to average 3.7 percent in 2019, down from 4.1 percent.
Kganyago said weak business confidence, possible electricity supply constraints and high debt levels in certain state-owned enterprises would continue to limit investment prospects.
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