News

South Africa Trims Interest Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy. Policymakers emphasized ongoing global uncertainty, noting that many countries have yet to finalize trade agreements before the US tariff deadline. They also observed a stronger rand and more moderate inflation expectations, with June’s CPI showing headline inflation at 3% and core inflation at 2.9%, both near the lower bound of the target range. Inflation is expected to rise modestly to 3.3% this year before stabilizing at 3% in 2027. Meanwhile, the economy’s outlook remains subdued due to persistent supply-side challenges, particularly in logistics. Consequently, growth forecasts were revised down to 0.9% in 2025 (from 1.1% previously) and 1.3% in 2026 (from 1.5%), but raised to 2% in 2027 (from 1.8%).
Published on 2025-07-31

South Africa Trims Policy Rate as Expected
The South African Reserve Bank slashed its key interest rate by another 25 bps to 7% on July 31, 2025, as widely anticipated, as the country braced for a new US tariff regime that could hurt the already fragile economy. The decision was unanimous and brought borrowing costs to their lowest since November 2022.
Published on 2025-07-31

South Africa Trims Policy Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy.
Published on 2025-07-31

South Africa Trims Interest Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy.
Published on 2025-07-31

South Africa Trims Interest Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy. Policymakers noted that the rand has strengthened and inflation expectations have moderated. June CPI showed headline inflation at 3% and core at 2.9%, near the bottom of the target range. Headline inflation is expected to rise to around 3.3% this year before stabilizing near the target for the rest of the forecast period.
Published on 2025-07-31

South Africa Trims Interest Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy. Policymakers highlighted that the rand has strengthened and inflation expectations have moderated. June CPI showed headline inflation at 3% and core at 2.9%, near the bottom of the target range. Headline inflation is expected to rise to around 3.3% this year before stabilizing near the target for the rest of the forecast period. Meanwhile, the economy’s underlying growth remains subdued, largely due to ongoing supply-side challenges, particularly in logistics.
Published on 2025-07-31

South Africa Trims Interest Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy. Policymakers noted that global economic conditions remain uncertain as many countries have yet to finalize trade deals ahead of the US tariff deadline, with risks of lasting higher tariffs and geopolitical tensions weighing on the outlook. They highlighted that the rand has strengthened and inflation expectations have moderated. June CPI showed headline inflation at 3% and core at 2.9%, near the bottom of the target range. Headline inflation is expected to rise to around 3.3% this year before stabilizing near the target for the rest of the forecast period. Meanwhile, the economy’s underlying growth remains subdued, largely due to ongoing supply-side challenges, particularly in logistics.
Published on 2025-07-31

South Africa Trims Interest Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy. Policymakers emphasized ongoing global uncertainty, noting that many countries have yet to finalize trade agreements before the US tariff deadline, which raises the risk of prolonged higher tariffs. They also observed a stronger rand and more moderate inflation expectations, with June’s CPI showing headline inflation at 3% and core inflation at 2.9%, both near the lower bound of the target range. Meanwhile, the economy’s growth outlook remains subdued due to persistent supply-side challenges, particularly in logistics. Consequently, growth forecasts were revised down to 0.9% in 2025 (from 1.1%) and 1.3% in 2026 (from 1.5%), but raised to 2% in 2027 (from 1.8%).
Published on 2025-07-31

South Africa Trims Interest Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy. Policymakers emphasized ongoing global uncertainty, noting that many countries have yet to finalize trade agreements before the US tariff deadline. They also observed a stronger rand and more moderate inflation expectations, with June’s CPI showing headline inflation at 3% and core inflation at 2.9%, both near the lower bound of the target range. Inflation is expected to rise modestly to 3.3% this year before stabilizing at 3% in 2027. Meanwhile, the economy’s outlook remains subdued due to persistent supply-side challenges, particularly in logistics. Consequently, growth forecasts were revised down to 0.9% in 2025 (from 1.1%) and 1.3% in 2026 (from 1.5%), but raised to 2% in 2027 (from 1.8%).
Published on 2025-07-31

South Africa Trims Interest Rate as Expected
The South African Reserve Bank unanimously reduced its key interest rate by 25 basis points to 7% on July 31, 2025, the lowest level since November 2022. The cut was widely anticipated amid concerns over a new US tariff regime threatening the already fragile economy. Policymakers emphasized ongoing global uncertainty, noting that many countries have yet to finalize trade agreements before the US tariff deadline. They also observed a stronger rand and more moderate inflation expectations, with June’s CPI showing headline inflation at 3% and core inflation at 2.9%, both near the lower bound of the target range. Inflation is expected to rise modestly to 3.3% this year before stabilizing at 3% in 2027. Meanwhile, the economy’s outlook remains subdued due to persistent supply-side challenges, particularly in logistics. Consequently, growth forecasts were revised down to 0.9% in 2025 (from 1.1% previously) and 1.3% in 2026 (from 1.5%), but raised to 2% in 2027 (from 1.8%).
Published on 2025-07-31

South Africa Cuts Key Rate to 7.25%, As Expected
The South African Reserve Bank cut its key interest rate by 25 bps to 7.25% on May 29, 2025, as widely anticipated, following a pause in March, to support a faltering economy and in response to a more favorable inflation outlook. Policymakers revised inflation forecasts downward, now expecting it to average 3.2% in 2025 (vs. 3.6% in March) and 4.2% in 2026 (down from 4.5%), citing a lower starting point, more favorable oil prices and exchange rates, and the scrapping of planned VAT hikes. Growth projections were also lowered from 1.7% to 1.2%, reflecting increased downside risks. Despite some headwinds, the outlook for structural reforms remains broadly positive. The Committee indicated a preference for steering inflation toward 3%, aiming to anchor expectations near the lower end of the target range, and plans to explore a 3% objective in future meetings.
Published on 2025-05-29

SARB Leaves Rates on Hold
The South African Reserve Bank kept the repo rate unchanged at 7.5% during its 2025 March meeting, with risks to economic stability calling for caution. Inflation, while contained, has edged higher, with goods inflation remaining low but services inflation rising. VAT hikes and CPI reweighting affected the outlook, but lower fuel prices and electricity tariffs improved projections. In February inflation was steady at 3.2%, its highest in four months. The central bank sees headline inflation at 3.6% this year and 4.5% next year. Looking to GDP, overall growth was weak at 0.6% in 2024, below expectations and slightly worse than 2023. The 2025 forecast was revised down to 1.7% due to weak demand and supply issues. The 2025Q1 GDP projection is 0.4% (q/q, seasonally adjusted), while 2025Q2 is 0.5%.
Published on 2025-03-20

South Africa Slashes Key Policy Rate as Expected
The South African Reserve Bank cut its key interest rate by another 25 basis points to 7.50% on January 30th, 2025, as anticipated, marking the third successive reduction. While inflation remained well-contained, the central bank noted that the medium-term outlook was more uncertain than usual. Inflation is expected to remain in the bottom half of the target range during the first half of this year, but the medium-term projections are closer to 4.5%, with upside risks, especially from global factors. The 2025 inflation forecast was revised down to 3.9% from 4%, while the estimates for 2026 and 2027 were kept steady at 4.6% and 4.5%, respectively. Meanwhile, South Africa’s economy is expected to rebound in the fourth quarter after a third-quarter slowdown, largely due to an unusually sharp decline in agricultural production. Over the next few years, growth is projected to rise steadily, reaching 2% by 2027.
Published on 2025-01-30

South Africa Trims Key Policy Rate to 7.75%
The South African Reserve Bank reduced its key interest rate by 25 basis points to 7.75% on November 21st, 2024, as anticipated, bringing borrowing costs to their lowest level since April 2023. Policymakers stressed that while inflation is well-contained in the short term, the medium-term outlook carries significant uncertainties and potential for upside risks. The Bank noted that headline inflation dipped below its target range of 3%-6% at 2.8% in October, reflecting a stronger exchange rate and lower oil prices compared to last year, with these temporary supply shocks expected to keep inflation below 4% until mid-2025. The 2024 inflation forecast was revised down to 4.5% from 4.6%, while the 2025 estimate remained unchanged at 4%, and the 2026 projection was raised to 4.6% from 4.4% due to higher electricity prices. Regarding economic growth, the central bank kept its 2024 forecast at 1.1%, increased its 2025 projection to 1.7% from 1.6%, and held its 2026 forecast steady at 1.8%.
Published on 2024-11-21

South Africa Cuts Key Rate for 1st Time Since 2020
The South African Reserve Bank slashed its key interest rate by 25 bps to 8% on September 19, 2024, as expected, following seven consecutive meetings at a 15-year peak of 8.25%. This marks the SARB’s first policy easing since the pandemic in 2020, as price pressures cooled. The annual inflation slowed to 4.4% in August from 4.6% the prior month, dropping below the midpoint of the central bank's preferred target range of 3% to 6%, for the first time in over three years. Policymakers expect this progress to be sustained, with inflation projected to remain below the 4.5% midpoint through the end of the forecast horizon in 2026. Accordingly, inflation projections were lowered, with 2024's forecast cut to 4.6% from 4.9%, the 2025 estimate reduced to 4% from 4.4%, and the 2026 projection trimmed to 4.4% from 4.5%. Concerning economic activity, the SARB maintained its 2024 projection at 1.1%, while revising its 2025 forecast up to 1.6% (from 1.5%) and its 2026 forecast to 1.8% (from 1.7%).
Published on 2024-09-19

SARB Leaves Rates on Hold
The South African Reserve Bank kept the repo rate unchanged at a 15-year high of 8.25% for a seventh consecutive meeting in July 2024 meeting, in line with market expectations. However, two policymakers preferred a reduction of 25 basis points. The central bank noted that restrictive policy remains appropriate to stabilise inflation at 4.5% and that an unchanged stance remained appropriate, given the inflation risks. Some officials, however, were of the view that the inflation outlook had improved enough to reduce the degree of restrictiveness. The central bank added that inflation expectations do not yet reflect the 4.5% midpoint objective over the medium term. While expectations are moving in the right direction, they continue to show the impact of the recent inflation surge. Inflation in South Africa came in at 5.2% in May.
Published on 2024-07-18

South Africa Interest Rate Holds at 8.25%
The South African Reserve Bank unanimously decided to keep its key repo rate at 8.25% on May 30th, 2024, marking the sixth consecutive meeting at 2009-highs, as widely expected. While the inflation forecast risks are assessed as broadly balanced, the Committee believes that high inflation expectations necessitate achieving their target sooner rather than later to re-anchor these expectations. Inflation fell for the second month to 5.2% in April, from 5.3% in the prior month, but still above the target of 4.5%. Forecasts now indicate that inflation is expected to reach the midpoint of its target range in the second quarter of 2025, sooner than previously predicted, as it was initially expected to occur by the end of next year. The inflation projection for this year was left unchanged at 5.1%. For 2025, it was revised slightly down to 4.5% (vs 4.6% in March). Regarding economic activity, the SARB maintained its growth projections at 1.2% for this year, at 1.4% for 2025 and 1.6% for 2026.
Published on 2024-05-30

South Africa Keeps Rates Steady for 5th Time
The South African Reserve Bank unanimously decided to maintain its key repo rate at 8.25% on March 27th, 2024, marking the fifth consecutive meeting at 2009-highs, as expected. Policymakers highlighted that, on balance, risks to the inflation outlook were skewed to the upside. Headline inflation accelerated for the second consecutive month, reaching 5.6% in February, up from January's 5.3%, nearing the upper limit of the central bank's target range of 3-6%. Forecasts now indicate that inflation is expected to reach the midpoint of its target range only by the end of 2025, later than previously predicted, as it was initially expected to occur by the middle of the year. The inflation projection for this year was slightly revised upward to 5.1%, compared to January's estimate of 5%. For 2025, it remained unchanged at 4.6%. Regarding economic activity, the SARB maintained its growth projections at 1.2% for 2024 but revised them upward to 1.4% for 2025, up from 1.3% earlier.
Published on 2024-03-27

South Africa Leaves Policy Rates Untouched
The South African Reserve Bank unanimously decided to keep its key repo rate at 8.25% on January 25th, 2024, as widely anticipated, thereby keeping borrowing costs at their highest since 2009. The bank highlighted the persistence of inflation risks while emphasizing a balanced evaluation of risks to medium-term growth. It noted that the return of inflation to the target has been slow, despite the expected gradual moderation. Headline inflation fell for a second month to 5.1% in December from 5.5% in November, but still above the preferred 4.5% midpoint of the central bank's target of 3-6%. The inflation forecast was kept at 5% for 2024 and was slightly revised upward to 4.6% for 2025, compared to the previous estimate of 4.5% in November. Concerning economic activity, the SARB maintained its growth projections at 1.2% for 2024 and 1.3% for 2025. Looking ahead, Governor Kganyago said future interest rate decisions will depend on the data available during the MPC meetings.
Published on 2024-01-25

South Africa Keeps Rates Steady
The South African Reserve Bank decided unanimously to leave its key repo rate steady at 8.25% on November 23rd, 2023, in line with expectations. This decision aimed to firmly anchor inflation expectations around the target midpoint and enhance confidence in achieving the inflation goal. The bank mentioned that inflation risks remain elevated, while the risks for medium-term domestic growth appear balanced. October's headline inflation surged to 5.9%, nearing the upper limit of the 3% to 6% target range and moving away from the preferred 4.5% midpoint where it prefers to anchor inflation expectations. Despite this, the inflation forecast was revised slightly down to 5.8% for this year (vs 5.9% in September) and 5% for 2024 (vs 5.1%). Looking ahead, the projection indicates stability at 4.5% for both 2025 and 2026. Regarding economic activity, the SARB lifted its GDP growth forecast to 0.8% for this year (up from 0.7%), to 1.2% for 2024 (vs 1%), and to 1.3% for 2025 (vs 1.1%).
Published on 2023-11-23