{"id":66769,"date":"2024-05-24T16:46:48","date_gmt":"2024-05-24T16:46:48","guid":{"rendered":"https:\/\/www.africa-press.net\/south-africa\/all-news\/long-wait-for-any-interest-rate-joy-in-south-africa"},"modified":"2024-05-24T18:44:30","modified_gmt":"2024-05-24T18:44:30","slug":"long-wait-for-any-interest-rate-joy-in-south-africa","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/south-africa\/all-news\/long-wait-for-any-interest-rate-joy-in-south-africa","title":{"rendered":"Long wait for any interest rate joy in South Africa"},"content":{"rendered":"

Africa-Press – South-Africa. <\/strong><\/span>The South African Reserve Bank (SARB) is widely expected to hold interest rates again next week, with the forecasts for the start of the cutting cycle getting pushed back even further.<\/p>\n

Various economists and analysts expect the Monetary Policy Committee (MPC) to stick with rates at 8.25% when it meets next Thursday (30 May), with inflation in South Africa and much of the rest of the world proving sticky.<\/p>\n

Inflation figures from Stats SA on Wednesday (22 May) showed a surprise cooling to 5.2%, where the market was pricing in a flat 5.3% or even a small hike.<\/p>\n

However, this is likely not enough to convince the Reserve Bank that inflation is under control and sustainably tracking to the mid-point of its target range at 4.5%. The bank has repeatedly stated that interest rate cuts won\u2019t come until it is satisfied the battle against inflation has been won.<\/p>\n

This is a prevailing theme across many other major central banks, including the US Fed.<\/p>\n

Minutes from the Fed\u2019s committee meeting in April \/May showed that. while US policymakers broadly expect inflation to return to target over the medium term, confidence has been dented by recent upturns in CPI.<\/p>\n

According to economists at Nedbank, this signals that disinflation would likely take longer than previously anticipated. Some analysts even suggest a further tightening of policy should inflation dynamics remain unfavourable.<\/p>\n

\u201cMarkets have largely priced in a September cut by the Fed, but it is clear from the minutes and recent comments from officials that interest rates could remain at current levels beyond September 2024,\u201d Nedbank said.<\/p>\n

While there is nothing strictly tying the SARB\u2019s moves to that of the US Fed, given the impact on the local currency of States-side decisions, the Reserve Bank tends to lag on its policy moves \u2013 which means that South Africa\u2019s interest rate cuts may only come a meeting or two behind.<\/p>\n

This would put a start to the cutting cycle sometime in early 2025 \u2013 something which investors and fund managers have already considered a possibility.<\/p>\n

However, Nedbank said that expects conditions will \u201cgradually become more supportive of monetary policy easing over the next four to five months\u201d.<\/p>\n

Consequently, the group expects the first 25 basis point (bps) cut in September, followed by another of the same margin in November.<\/p>\n

\u201cThe repo rate is forecast to end the year at 7.75%, taking the prime lending rate to 11.25%. Real interest rates will increase further, stabilising above 2% as inflation dips below 5% later this year and throughout next year,\u201d it said.<\/p>\n

According to Investec chief economist Annabel Bishop, the bank has a slightly less optimistic outlook, though it also currently expects the cutting cycle to start in 2024.<\/p>\n

Investec sees a hold on rates through September 2024, with a single 25 bps cut on the cards at the (final) November 2024 meeting.<\/p>\n

The group forecasts the cutting cycle terminating after a total of 150 basis points dropped, which could end around the middle of 2025 at the July meeting (repo rate at 6.75%).<\/p>\n

Investec\u2019s forecast is outlined below:<\/p>\n

<\/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 South African Reserve Bank (SARB) is widely expected to hold interest rates again next week, with the forecasts for the start of the cutting cycle getting pushed back even further. Various economists and analysts expect the Monetary Policy Committee (MPC) to stick with rates at 8.25% when it meets next Thursday […]<\/p>\n","protected":false},"author":84,"featured_media":66768,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5],"tags":[274,315,275],"class_list":["post-66769","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":"\nLong wait for any interest rate joy in South Africa - South Africa<\/title>\n<meta name=\"description\" content=\"The South African Reserve Bank (SARB) is widely expected to hold interest rates again next week, with the forecasts for ...\" \/>\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\/long-wait-for-any-interest-rate-joy-in-south-africa\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Long wait for any interest rate joy in South Africa\" \/>\n<meta property=\"og:description\" content=\"The South African Reserve Bank (SARB) is widely expected to hold interest rates again next week, with the forecasts for ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/long-wait-for-any-interest-rate-joy-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=\"2024-05-24T16:46:48+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-05-24T18:44:30+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/05\/sm_1716563426.716954.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=\"3 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\/long-wait-for-any-interest-rate-joy-in-south-africa#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/long-wait-for-any-interest-rate-joy-in-south-africa\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Long wait for any interest rate joy in South Africa\",\"datePublished\":\"2024-05-24T16:46:48+00:00\",\"dateModified\":\"2024-05-24T18:44:30+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/long-wait-for-any-interest-rate-joy-in-south-africa\"},\"wordCount\":517,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/long-wait-for-any-interest-rate-joy-in-south-africa#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/05\/sm_1716563426.716954.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\/long-wait-for-any-interest-rate-joy-in-south-africa#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/long-wait-for-any-interest-rate-joy-in-south-africa\",\"url\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/long-wait-for-any-interest-rate-joy-in-south-africa\",\"name\":\"Long wait for any interest rate joy in South Africa - 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