In fact, one could see two main reasons why a rise in US interest rates could justify a similar move in a country like South Africa: first, if the US move reflects an inflationary acceleration in the US economy that looks set to be replicated in South Africa; and second, if the US rate increase affects capital flows to South Africa to the point that the rand depreciates significantly and raises prospective domestic inflation.
The first argument can be dismissed in the present situation. As I previously indicated, the Fed, if it begins to raise interest rates in the coming months, will not do so because of a strong, potentially inflationary acceleration in US gross domestic product (GDP) growth. It will do so to ensure sustained US growth through a gradual reduction in the degree of monetary accommodation.