FNB expecting rates to be hiked by further 50 basis points this year
FNB economist Mamello Matikinca expects rates to be hiked by a further 50 basis points this year. She says the deceleration in producer price inflation in March was consistent with the downside surprise in the consumer price inflation print and does not alter her view of further policy tightening.“… we’ve pencilled a further 50 basis points of hikes this year.”Matikinca adds that she does not read the deceleration in producer price inflation as the beginning of a downward trend in the inflation outlook.“We expect inflation to rise steadily peaking in the last quarter of the year‚” she says. Producer price inflation rose by 7.1% ear on year (y/y) in March‚ down from 8.1% y/y in February.The rise in producer prices was driven by food‚ which contributed 3.1 percentage points to the inflation outcome‚ metal and machinery (+1.2ppt) as well as transport equipment (1.1ppt). Over the month‚ inflation rose by 0.7%...
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