SA’s new GNU Cabinet and what latest SA & US inflation data means for interest rates
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In SA’s new Government of National Unity (GNU) Cabinet, the number of ministers and deputy ministers has grown, which is costly, and there are a lot of new faces in Cabinet whose competence cannot be judged yet. However, there are positive aspects: there is continuity in the key economic cluster, implying that fiscal policy is likely to stay the same, and reform of SOEs is expected to continue under the Presidency.
SA’s PPI inflation rate for May at 4.6% was below market expectations, and the details were encouraging, other than for manufactured food inflation. Trends should lead to interest rate cuts starting in September. In the US, core PCE was also in line with expectations at 2.6%, close to the US Federal Reserve’s 2% target, and a September interest rate cut remains on the horizon.
Click here to listen to the podcast.
SA’s PPI inflation rate for May at 4.6% was below market expectations, and the details were encouraging, other than for manufactured food inflation. Trends should lead to interest rate cuts starting in September. In the US, core PCE was also in line with expectations at 2.6%, close to the US Federal Reserve’s 2% target, and a September interest rate cut remains on the horizon.
Click here to listen to the podcast.
