It seems six weeks are a long time in economics. Over that period, the interest rate debate has shifted from certainty of a rate hike to nascent talk of a rate cut next year.
That's a dramatic change, which shows what an unpredictable world we live in.

The key to this debate is, of course, the monetary policy committee (MPC) statement which is released after MPC meetings every six weeks or so.

The statement is scrutinised by analysts for clues on what the next move in interest rates will be - up, down or sideways.

The latest MPC statement was released on Thursday, and its tone was considerably less hawkish than the previous one.

The October MPC statement was hawkish, and was read to imply that the central bank was ready to raise the repo rate from its current level of 7%.

The hawkishness was further reinforced by comments from Reserve Bank governor Tito Mboweni, who in October virtually promised a rate hike this month.

Adding fuel to the fire was Finance Minister Trevor Manuel, who spoke of the need for a "timeous" hike in interest rates.

The key reason for the hawkishness was the high oil price, and Mboweni's view that pre-emptive action was needed to prevent second round effects from occurring.

But the war talk was oddly timed, seeing that the fuel price fell by 31c/litre in November and then by a further 30c/litre this month.

Thursday's MPC statement highlighted these declines, as well as the possibility of a further cut in the petrol price in January. These fuel price declines are key reasons why the tone in Thursday's MPC statement was much softer than the previous one.

The statement focused on the reasons why the inflation outlook had improved since the last MPC statement. The main factor was the decline in the oil price. Brent crude had averaged around $55 since November after averaging $64.50 in August.

"To date the overall impact of the international oil price increases on inflation and output have been far more muted than originally expected, both domestically and internationally," the MPC statement said.

Other reasons why the inflation outlook had improved included unchanged inflation expectations and exchange rate developments.

The effective exchange rate of the rand had appreciated by almost 7% since the last MPC meeting. In addition, wage growth had remained moderate and the budget deficit was small.

But there were also negatives. The MPC said output and expenditure trends were likely to be a source of upward pressure on inflation. Still, this was moderated by the fact that manufacturing production had declined significantly.

Expenditure, however, was exceptionally robust, with final demand rising at an annualised rate of 6% in the first three quarters of the year. Money supply and credit growth was also high, though the rates of increase had moderated recently.

The deficit on the current account was also a source of concern, although this had been financed comfortably by capital inflows.

The MPC concluded: "Should the outlook deteriorate, the MPC will not hesitate to adjust the repo rate in the appropriate direction."

Though the tone of the statement was not especially hawkish, it wasn't dovish either. There wasn't anything in it to suggest that talk of a rate cut in the new year is justified.

Commentators who are predicting a rate cut point to the rand's renewed strength and weakness in manufacturing output as reasons why the central bank will move the repo rate down - provided the oil price doesn't rise dramatically.

But they're probably wrong, as are those economists predicting a rise in rates in February. The best bet is that interest rates will remain unchanged. The only thing that could shift that outlook is a sharp fall in the oil price, which could precipitate a cut in interest rates.

But how likely is that? A more likely scenario is that the oil price will stay high and that SA interest rates will remain unchanged for a protracted period.

The European Central Bank left rates unchanged for two years. The debate now shifts to how long SA rates will remain on hold.