5 important things happening in South Africa today
Here’s what is happening in and affecting South Africa today:
Interest rate warning: MPC member voting during its September interest rate meeting revealed that further interest rates are a definite possibility. Three members preferred to keep the rate on hold, while two wanted a 25 basis point hike. Economist Dawie Roodt said the small margin in the MPC voting signals that the Reserve Bank is not convinced that high inflation is a thing of the past. “I now predict that interest rates may even go up a little bit more this year, and we may have to wait until next year for the Reserve Bank to cut interest rates,” he said. [Daily Investor]
Eskom needs more money fast: The electricity grid expansion, which forms part of the energy action plan, is in dire need of funding. “I want to emphasise the speed with which we can make this decision. Otherwise, we are going to sit on the transmission side with the same problems we are sitting on the generation side, which is the speed of decision-making,” said Electricity Minister Kgosientsho Ramokgopa. The government needs more than R100 billion by the start of the next financial year to fund the expansion, but the government has yet to establish a funding model for it. [EWN]
Organised crime hotspot: SA is an outlier for crime in Southern Africa, with the situation worsened by state-embedded actors who work in cahoots with criminal networks, findings from the Global Organised Crime Index 2023 show. The study, conducted by the Geneva-based Global Initiative Against Transnational Organised Crime, found that SA is one of only three African countries in the high crime/high resilience category, along with Nigeria and Senegal. [Business Day]
More renewable energy deals: Japan and South Africa have entered into a new agreement to support the decarbonisation of the domestic economy. A Memorandum of Cooperation was signed between the two nations on Monday (25 September), and the agreement involves potential green hydrogen and ammonia projects, as well as technology transfer from Japan. [News24]
Markets: The South African rand weakened on Tuesday due to a surge in U.S. Treasury yields as investors turned away from riskier assets, analysts said. “I suspect the rand is playing catch-up to the rest of the market after the long weekend,” said Danny Greeff, co-head of Africa at ETM Analytics. On Wednesday (27 September), the rand was trading at R19.09/USD, R20.15/EUR and R23.18/GBP. Oil is trading at $94.85 a barrel. [Nasdaq]
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