Cautious Monetary Tightening Over Next Two Years

We believe that the monetary tightening cycle that the central bank embarked upon in September 2009 will continue through 2010 and 2011. Given the fragility of the domestic and global economic recoveries, the bank will remain cautious and as such, we would expect the 125bps of prospective interest rate hikes we have pencilled in for the remainder of the year to be back loaded.

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