Ramaphosa sends a warning to ANC-led municipalities, and new threat coming for Shoprite and Pick n Pay
The rand strengthened against a declining dollar, while government bonds gained stability on Monday.
This movement came after a survey commissioned by the country’s central bank revealed that long-term inflation expectations have dropped to a record low. The rand was trading at 17.3725 against the dollar, up 0.1% from Friday’s close.
In the survey conducted by the Bureau for Economic Research, analysts, business leaders, and trade unions indicated they expect annual inflation to average 4.2% over the next five years, down from the previously predicted 4.4%.
This change follows the South African Reserve Bank’s (SARB) announcement of its intention to target lower inflation rates.
Analysts believe that after recent rate cuts, the SARB will likely maintain interest rates at 7% as it seeks to guide inflation expectations toward a target of 3%.
On Tuesday, 16 September, the rand was trading at R17.35 to the dollar, R23.61 to the pound and R20.43 to the euro. Oil was trading slightly lower at $67.59 a barrel.
Here are five other important things happening in and affecting South Africa today:
Ramaphosa’s warning: President Cyril Ramaphosa warned that the ANC’s political future is at risk without improved service delivery. He highlighted that poor service, especially in ANC-led municipalities, threatens investor confidence and fiscal stability. “It’s either service delivery or death,” he told the party’s 4,600 councillors. [Business Day]
New threat coming for Shoprite and Pick n Pay: Walmart’s entry into South Africa poses a threat to Shoprite and Pick n Pay as it targets cost-conscious shoppers. The US retailer aims to attract these customers with its reputation for low prices, anticipating a strong demand for affordable, quality products. [MyBroadband]
Bad news for South Africa’s biggest open medical aid: The number of Discovery Health Medical Scheme (DHMS) members continues to decline, showing a 0.1% decrease compared to the same time last year. However, the rate of decline has improved from -1.1% reported in June 2024. [Moneyweb]
South Africa stuck in a debt trap: Moody’s warns that South Africa is in a debt trap due to high borrowing costs from fiscal strains and structural weaknesses. Despite its advanced capital markets in sub-Saharan Africa, the country pays more to borrow than many major emerging economies. [Primedia Plus]
Ford recalls more vehicles: More than 5,000 Ford Ranger models have been recalled by the National Consumer Commission (NCC) due to pedal defects. [EWN]
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