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<\/a><\/figure><\/div>\n\n\nInterest rate pain <\/strong><\/p>\n\n\n\n However, the expectation that interest rates have reached their plateau may be too optimistic. <\/p>\n\n\n\n “We expect that interest rates have reached their peak, with a measured cutting cycle coming into view in the latter half of 2024,” FNB said. <\/p>\n\n\n\n “However, the short-term prospects for this forecast carry an upside risk, particularly if upward pressure on food and fuel prices intensifies, and government fiscal position deteriorates<\/strong>.” <\/p>\n\n\n\n Bank of America economists Tatonga Rusike and Mikhail Liluashvili<\/a> and the Bureau for Economic Research (BER) said that the South African Reserve Banks (SARB’s) Monetary Policy Committee (MPC) will likely raise interest rates when it meets again next month. <\/p>\n\n\n\n \u201cHigher oil prices and an outbreak of bird flu \u2013 leading to shortages of poultry products \u2013 will likely raise food prices in the near future,\u201d Rusike and Liluashvili said.<\/p>\n\n\n\n \u201cOil prices are also close to $90 per barrel, while USD\/ZAR is weakening near term. A strong USD to year-end means a weaker ZAR as global interest rates are set to stay higher for longer. Near-term fiscal risks are likely concerning for the SARB as well.”<\/p>\n\n\n\n \u201cThe South African Reserve Bank (SARB) is likely to hike rates by another 25 basis points at the November MPC before initiating cuts in the second quarter of 2024<\/strong>.\u201d This would take the repo rate to 8.50%. <\/p>\n\n\n\n