Growth is expected to recover slowly from 2016 lows, and our growth forecasts have lately been revised up slightly, breaking a multi-year trend of downward revisions. Furthermore, the rand may just about end the year stronger than it started, for the first time since 2010.
Right now, with more favourable yields and spreads the situation suggests that current developments of low inflation, high unemployment and significant economic slack, are more likely to be driven by a negative aggregate demand shock.