IEASA National - News

Likelihood of rate hike in first quarter 2006 increases   Article Date :27 Oct 2005 Comments from ABSA Bank. Absa, South Africa's largest commercial bank, is not excluding the possibility of an interest rate hike in the first quarter of 2006, as the second-round effects of higher fuel prices filter through in the first half of 2006. The bank, in its reaction to this week's repo rate remaining unchanged at seven percent, says it is of the opinion that with high credit demand, continued strong consumer spending and no significant easing of international oil prices, the risk remains heavily in favour of an interest rate hike in 2006. It supports this view following the SA Monetary Policy Committee (MPC) warning after its two day meeting this week that although it had only seen limited passthrough effects thus far of petrol prices to prices of good and services monetary policy the MPC would remain vigilant in anticipating such developments. CLICK HERE TO RETURN TO THE MAIN NEWS PAGE