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Politics : Dutch Central Bank Sale Announcement Imminent?
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To: sea_urchin who wrote (18129)4/30/2003 11:52:32 AM
From: yard_man  Read Replies (1) of 81011
 
what makes you think that higher rates in SA will not reign in inflation?? I don't follow your reasoning

... while the stronger rand has reduced profits it seems to me that it is what happens to the POG that matters most ...

South Africa's strong currency is not all bad as some imply, IMO. Since the mid-90's there have been a number of countries which raised rates and didn't arrest capital flight. South Africa's policy appears to be working to me -- what am I missing? I expect that they will be quite effective at bringing inflation down -- which will be much better in the long run.

I suspect that the great recent strength of the rand is a short-lived phenomena -- how long can rates be kept so high?? And how long can rates elsewhere be kept so low -- but due to the small size (relative) of their economy to the rest of the world and all the hot money seeking yield, things have been exacebated much more than they might have.
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