The South African Reserve Bank (SARB) finally began its long-awaited tightening cycle by raising the repo rate from 5.75% to 6.00% this month. We had anticipated the move, and expect that the SARB will hike rates by another 25bp later this year as inflation rises, the rand weakens, and US monetary policy is normalised. But the impacts of currency weakness and rising US rates will also prompt tighter monetary policy elsewhere in the continent; Uganda, Kenya, and Ghana have all hiked rates over the past quarter and we expect that Nigeria will do so within the coming months. Higher rates may weigh on growth in some countries – particularly debt-laden South Africa – but tighter policy seems inevitable in many markets.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services