BER Predicts Three More Cuts
The information in this article is courtesy of iAfrica (BER sees 150bs cut – 22 May 2009).
The Bureau for Economic Research (BER) believes that more limited rate cuts of 50 basis points could be expected in South Africa. There is also a chance that the Reserve Bank might go a bit further than that.
Professor Ben Smit of BER said that the Governor acknowledges recession meaning we can expect “recessionary conditions”.
According to Smit some improvement can be expected towards the 3rd quarter of the year, and he pointed out that the global crisis has probably had about 4% impact on the BER’s GDP forecasts.
BER predicts inflation in South Africa at an average of 6.8% in 2009, dipping below 6% in August, but ending the year back at 6.9%. In 2010 these levels will move back to within target range averaging 5.3%.
In other predictions, the BER sees South Africa's nominal wage rate at an annual average of 8.3 percent in 2009 from 9.9 percent in 2008, dipping to 6.3 percent in 2010.