“South Africa’s most direct exposure to the Russia-Ukraine military conflict is through higher inflation and related fiscal pressure stemming from social demands,” the group said in a note on Wednesday .
Moody’s projects the Reserve Bank will continue to hike rates, raising the repurchase rate by 25 basis points to 4.25% on 24 March 2022, marking 75 basis points of cumulative tightening since August 2021. “South Africa’s large and diversified economy, effective monetary – and more recently fiscal–policy framework and deep financial sector are its principal buffers against shocks. During the coronavirus pandemic, government and central bank policy measures mitigated the impact of the shock on economic activity while committing to fiscal sustainability, although the country came out of the shock with record-high unemployment rate,” it said.
Dear CeylaP_IMF & IMFNews South Africa can kick start its economy by: 1- Remove all racist BBBEE laws 2- Remove all labour law red type 3- Reduce Company Income tax to 22%!