South African Reserve Bank leaves repurchase rate unchanged at 7%

By Richard Connell

New York, Oct. 22 - The Monetary Policy Committee of the South African Reserve Bank kept its repurchase rate at 7% at its meeting on Thursday, according to a news release issued by the bank.

The committee examined the most recent data on inflation, which showed a decline to 6.4% in August from 6.7% in July, due to lower prices in housing, utilities and miscellaneous goods and services.

The committee forecast that inflation should return to the inflation target range of 3%-6% by Q2 2010 and remain there until the end of 2011, due to subdued domestic demand.

The committee also forecast that economic growth is expected to improve in the coming months, but warned that risks still exist to a full economic recovery.

Assessing that the inflation outlook has not changed since the previous meeting, the committee kept the rate at 7%.

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