{"id":61566,"date":"2024-02-22T16:09:09","date_gmt":"2024-02-22T16:09:09","guid":{"rendered":"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa"},"modified":"2024-02-22T16:47:31","modified_gmt":"2024-02-22T16:47:31","slug":"another-blow-for-interest-rates-in-south-africa","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa","title":{"rendered":"Another blow for interest rates in South Africa"},"content":{"rendered":"

Africa-Press – South-Africa. <\/strong><\/span>The latest minutes from the United States Federal Open Market Committee (FOMC) have all but cemented a longer hold on interest rates in South Africa at 14-year highs, with the market now expecting rate cuts in the world\u2019s biggest economy after the middle point of the year, possibly only in Q3.<\/p>\n

According to Investec chief economist Annabel Bishop, the FOMC minutes release caused some consternation for the rand, even after the better-than-expected 2024 Budget brought some relief and strength to the local unit.<\/p>\n

The rand then strengthened to R18.77\/$ following the Budget but then quickly retreated back closer to R19.00\/$ after minutes from the FOMC\u2019s January meeting showed that US interest rate cuts are not imminent, strengthening the dollar.<\/p>\n

Participants remained attentive to inflation risks and worried that inflation was still above the committee\u2019s longer-run goal.<\/p>\n

Participants were also concerned that price stability could stall, especially if aggregate demand strengthened or supply-side healing slowed more than expected.<\/p>\n

Participants said that the uncertainty associated with how long the restrictive monetary policy stance needs to be maintained, with markets none the wiser over when the fed funds rate will be cut.<\/p>\n

Most of the market (93%) expects the first cut to come in June, with a 25 basis point cut expected, with a 100% chance of a 25 basis point cut in July and a 0% chance of a further 25 basis point cut.<\/p>\n

\u201cWe expect this is when the first SA interest cut will occur as well, although South Africa remains likely to only make its first interest rate cut after the US has begun its interest rate cut cycle, and if US rate cuts are delayed, so will South Africa\u2019s be to later in Q3.24,\u201d Bishop said.<\/p>\n

\u201cThat is, decreasing South Africa\u2019s interest rates before the US cuts would reduce the differential between South Africa\u2019s and the US\u2019s interest rates further, which would see additional rand weakness and so place upward pressure on South Africa\u2019s inflation rate.\u201d<\/p>\n

The South African Reserve Bank has stated that it will not drop interest rates until CPI reaches its targeted midpoint of 4.5%.<\/p>\n

For More News And Analysis About South-Africa<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – South-Africa. The latest minutes from the United States Federal Open Market Committee (FOMC) have all but cemented a longer hold on interest rates in South Africa at 14-year highs, with the market now expecting rate cuts in the world\u2019s biggest economy after the middle point of the year, possibly only in Q3. According […]<\/p>\n","protected":false},"author":84,"featured_media":61564,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5],"tags":[274,315,275],"class_list":["post-61566","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","tag-africa-press","tag-africa-press-south-africa","tag-south-africa-2"],"yoast_head":"\nAnother blow for interest rates in South Africa - South Africa<\/title>\n<meta name=\"description\" content=\"The latest minutes from the United States Federal Open Market Committee (FOMC) have all but cemented a longer hold on in ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Another blow for interest rates in South Africa\" \/>\n<meta property=\"og:description\" content=\"The latest minutes from the United States Federal Open Market Committee (FOMC) have all but cemented a longer hold on in ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa\" \/>\n<meta property=\"og:site_name\" content=\"South Africa\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2024-02-22T16:09:09+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-02-22T16:47:31+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/02\/sm_1708607375.560742.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1024\" \/>\n\t<meta property=\"og:image:height\" content=\"683\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Another blow for interest rates in South Africa\",\"datePublished\":\"2024-02-22T16:09:09+00:00\",\"dateModified\":\"2024-02-22T16:47:31+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa\"},\"wordCount\":369,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/02\/sm_1708607375.560742.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-South-Africa\",\"South-Africa\"],\"articleSection\":[\"all news\",\"economy\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa\",\"url\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/another-blow-for-interest-rates-in-south-africa\",\"name\":\"Another blow for interest rates in South Africa - 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