South Africa’s central bank says load shedding and logistics constraints continue to undermine economic growth domestically.
The apex bank, also called the Reserve Bank, disclosed this during the latest Monetary Policy Review published on Tuesday.
“While load shedding has been much better in 2024 relative to 2023, it’s still considerably higher than it’s been in previous years and therefore continues to weigh on growth,” said Reserve Bank Governor Lesestja Kganyago.
South Africa’s inflation has fluctuated within the 5-6% range since September 2023, South Africa’s SABC reports.
Uncertain targets
The Reserve Bank says uncertainty around its target of 4,5-midpoint range has risen in recent months as new economic risks have emerged.
“Since we last met in 2023, the main challenge facing the global economy has not changed much; suffice to say, many of the risks that we had identified are beginning to materialise, important inflation, which was seen as a huge policy challenge at least for central banks, is very much still with us. It remains the overarching policy challenge today,” adds Kganyago.
The Monetary Policy Review seeks to outline all the challenges considered by the Monetary Policy Committee (MPC) when making decisions on interest rates.
While the Reserve Bank has expressed optimism about economic growth, citing the government’s interventions in electricity supply, it warns about economic headwinds from the global economy.
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