South African Rand Maintains Strength

2026-01-22 15:56 By Luisa Carvalho 1 min. read

The South African rand extended its rally to trade around 16.2 per USD, reaching the highest since June 2022, benefiting from record-high precious metals prices, particularly gold and silver.

Meanwhile, economic data showed that South African inflation remains under control, which should give the central bank room to cut interest rates this year.

Inflation was marginally higher at 3.6% in January, but remained within the SARB’s 1-percentage-point tolerance band around its new 3% target.

The 2025 average inflation rate hit a 21-year low of 3.2%, below the central bank’s 3.3% forecast.

While a benign inflation outlook leaves scope for a rate cut at the upcoming meeting later this month, analysts remain divided, with the balance of factors suggesting the South African Reserve Bank is more likely to keep interest rates unchanged.

The SARB will ultimately weigh both domestic inflation conditions and global risks before taking the next step in the rate-cutting cycle.



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