South Africa: February CPI inflation is expected to fall to 4.1% - TDS

According to analysts at TDS, South Africa’s February CPI inflation is expected to fall to 4.1% Y/Y from a prior 4.4%. Core inflation is expected to remain unchanged at 4.1%.
Key Quotes
“With inflation likely to be comfortably below the middle of the 3-6% target range we expect the SARB to cut its policy rate by 25bps to 6.5% at the 28 March MPC meeting. A sharp sell-off of the rand before then could prevent the SARB cutting. The obvious risk event is Moody's review on Friday, but we do not expect a cut in the rating, and, anyway, if the rating is cut, we expect a relatively modest weakening in the rand, of the order of 2.5-3.0%.”
“Also today, Q4 current account deficit as a percentage of GDP is expected at 2.0%, a bit narrower than the prior 2.3%. The deficit has been on a narrowing trend over the past three years as the trade balance has swung from deficit to surplus, in part due to weak domestic demand.”
Author

Sandeep Kanihama
FXStreet Contributor
Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

















