South Africa’s economic calendar is quiet this week, with only electricity production data due locally. However, global developments will probably take centre stage as markets digest key releases from major economies — particularly the US — before the Federal Reserve’s interest rate decision on January 28. Focus in the days ahead will rest on US consumer inflation data, scheduled for Tuesday.Markets are still pricing inat least two cuts of 25 basis points from the Fed this year, though the central bank has signalled only one so far.
According to Bureau for Economic Research chief economist Lisette IJssel de Schepper, “Some Fed members are scheduled to speak in the coming days, before the blackout period starts next weekend.” This could potentially shift expectations. While the South African Reserve Bank does not mirror the Fed’s decisions, it closely monitors its policy stance, given its influence on global capital flows, exchange rate dynamics and investor sentiment towards emerging markets. A dovish or hawkish tilt from the Fed can affect the rand, which in turn plays a role in the Reserve Bank’s inflation outlook and interest rate decisions.
“Downside surprises on employment and inflation will strengthen the case for another rate cut at the Fed’s meeting on January 28,” Nedbank economists said in a note. However, “at this point, the markets are betting that policy rates will remain unchanged”. The December US jobs report, released on Friday, showed that just 50,000 jobs were added — the weakest monthly gain of the year.
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US unemployment edged down to 4.4%, though the broader trend remains subdued, with 2025 marking the weakest annual job growth since the pandemic year of 2020, Bloomberg reported. Meanwhile, eurozone numbers this week include final inflation prints, retail sales and industrial production for several member countries. IJssel de Schepper noted that Germany will publish its first estimate for full-year GDP growth, with the eurozone’s largest economy expected to record slight growth (about 0.2%) after a contraction in 2024.
China’s December trade figures are also expected. As for the remainder of January, South Africa will see more local data releases in the coming weeks, including consumer price inflation, retail sales figures and the Reserve Bank’s monetary policy committee decision on January 29 — all of which will help set the tone for economic policy early in 2026.
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