South Africa's Reserve Bank is anticipated to lower interest rates by 25 basis points this week, marking the third consecutive reduction. Economists predict this move due to favorable inflation figures and a stable economic outlook, potentially boosting consumer spending and investment. However, uncertainties surrounding the rand's weakness and the impact of the new US administration on global markets could lead to a cautious approach by the Bank.
Lost your password? Please enter your username or email address. You will receive a link to create a new password via email.Lost your password? Please enter your username or email address. You will receive a link to create a new password via email.to cut interest rates by 25 basis points when it concludes its monetary policy meeting this week, essentially bringing the repo rate down to 7.50% and the prime rate to 11%.
“These factors are encouraging for the monetary policy committee to create some stimulus in the economy, by giving us a rate cut,” she said. for the year is also more positive, giving the Reserve Bank more room to cut interest rates this year. The weakening rand might be an inflationary factor and the Reserve Bank will tread cautiously as it assesses the implication of developments in the United States under the new Trump administration, she added.
Inflation edged up to 3% in December from 2.9% in November, mainly driven by slower deflation in transport and increasing food inflation, according to Statistics South Africa. Transport slowed to 2% from 3.3%, inflation for food and non-alcoholic beverages edged up to 1.7% from 1.6%. This is on the back of “recent evidence of sticky inflation and growing concerns that Trump’s policies could reawaken price pressures”, according to Nedbank.
INTEREST RATES INFLATION RESERVE BANK SOUTH AFRICA MONETARY POLICY
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