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Markets See Decent Chance of 75bps Move Today

SOUTH AFRICA
  • The SARB rate decision takes focus later today, with the press conference beginning at 1400BST/0900ET, with the rate decision to follow shortly afterwards. Consensus remains for a 50bps hike, which would be inline with the pace of prior tightening, however yesterday’s firmer-than-expected CPI supports those that see a material risk of 75bps today.
  • The ZAR FRA-JIBAR spread implies that a 50bps hike is fully priced today, while a 75bps move is around 30% priced. The full MNI SARB Preview is here: https://marketnews.com/mni-sarb-preview-july-2022-...
  • Fin24 report that national petrol and diesel prices could be cut next month, if underlying benchmark oil prices hold recent weakness. Central Energy Fund data suggests a cut of as much as 60c in petrol and 28c in diesel, countering the impact of the rolling off of fuel levy subsidies installed by the government some months ago.
  • Unions affiliated with COSATU have called on members to strike on August 4th in response to the government’s failed attempts to address rising crime rates in Cape Town. Cosatu has applied for as many as 3,000 workers to take part in the strikes, according to the Daily Maverick.
  • Data from Experian shows the rate of consumers who defaulted on their loans for the first time increased in Q1 this year, rising from 3.49% to 3.68%. Nonetheless, the Y/Y rate continues to improve – although the data remains clouded by the impact of COVID lockdowns, prompting Experian to caution against the Y/Y trends.
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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