Announcing a 25 basis point increase in the repo rate to 7%, Sarb Governor Lesetja Kganyago said the Monetary Policy Committee (MPC) was responding to growing risks posed by the prolonged Middle East conflict, higher fuel and food prices, and the possibility of second-round inflation effects.
The South African Reserve Bank (Sarb) has warned that further interest rate hikes may still be necessary if inflation pressures intensify.
This comes as the central bank on Thursday outlined a series of risk scenarios that could push inflation above 6% and force policymakers into additional monetary tightening.
Announcing a 25 basis point increase in the repo rate to 7%, Sarb Governor Lesetja Kganyago said the Monetary Policy Committee (MPC) was responding to growing risks posed by the prolonged Middle East conflict, higher fuel and food prices, and the possibility of second-round inflation effects.
The increase lifts the prime lending rate to 10.5%.
