South Africa could see another three interest rate cuts between now and mid-2027, analysts predict. South African interest rates are on hold for now, with the South African Reserve Bank (SARB) having opted tokeep the repo rate unchangedat 6.75% during its first Monetary Policy Committee (MPC) meeting, held on Thursday, January 29. This means South Africa’s prime lending rate remains at 10.25%.
Four members of the MPC voted in favour of a rate hold while two members signalled a preference for a 25-basis-point cut. This follows December’s headline Consumer Price Inflation (CPI) figure, which increased slightly to 3.6% year-on-year, from November’s 3.5%. SARB Governor Lesetja Kganyago indicated that December’s CPI figure was likely the ‘peak’ and that the Reserve Bank expected inflation to ease during 2026.
This is in line with the predictions of most analysts, and given the current projections, South Africa is likely to see about three more interest rate cuts in the next 18 months, says Nolan Wapenaar, head of fixed income at Anchor Capital. South Africa’s inflation rate over the last seven years.
