South Africa Reserve Bank Reduces Interest rate by 25 points

 

South Africans are gobsmacked by the South African Reserve Bank’s decision to cut interest rates by 25 basis points.

 The Repo rate will be 8% and the prime rate 11.50%. SARB Governor Lesetja Kganyago said reduced inflation should be sustained. The monetary policy committee (MPC) decision means that home loans are now cheaper compared to 2021.

 In August this year consumer inflation submerged below the SARB’s optimum of 4.5%. Inflation has reduced a large amount in fuel prices, which South Africans can thank the strong rand for. Diesel and petrol price reductions are expected in the first week of October.

 The lower interest rate should ease financial stress in households, businesses and allow consumers to spend or save more money. Yesterday the Reserve Bank said that it has upgraded its’ expectations for 2025.

 The next MPC meeting will be on 21 November another interest rate cut is expected.

Done by: Shaneca Cupido