A special meeting of the SA Reserve Bank Monetary Policy Committee has been announced for September 10



This comes as a major surprise, says Absa, given that in June the SARB had announced scheduled meetings with a higher frequency than quarterly, i.e. every two months, and given that the MPC had met recently in August. Absa believes that the MPC will meet to consider an interest rate cut, but adds that its motives for not waiting for the scheduled October meeting are not clear. "What is possible is that the Bank is beginning to get concerned with weak economic growth (although this is not the prime targeted variable it remains a consideration), which is not being assisted by the strength of the rand. Added to the poor growth performance, and also the result of the strong rand is a steadily widening current account deficit, which paves the way for a possible sharp weakening of the rand at some later date."