{"id":854302,"date":"2026-03-18T12:00:00","date_gmt":"2026-03-18T10:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=854302"},"modified":"2026-03-18T12:05:41","modified_gmt":"2026-03-18T10:05:41","slug":"bad-news-for-interest-rates-in-south-africa-next-week","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/854302\/bad-news-for-interest-rates-in-south-africa-next-week\/","title":{"rendered":"Bad news for interest rates in South Africa next week"},"content":{"rendered":"\n

Inflation in South Africa has landed squarely on the South African Reserve Bank’s (SARB’s) new target of 3%, but interest rate cuts next week are unlikely due to the war in the Middle East. <\/p>\n\n\n\n

Consumer prices increased 3% year-on-year, down from 3.5% a month earlier, which was below the median estimate of 15 economists in a Bloomberg survey of 3.1%.<\/p>\n\n\n\n

Although the latest data is exactly in line with the SARB’s 3% target, it is unlikely to change the repo rate from its current level of 6.75% despite optimism at the start of the year. <\/p>\n\n\n\n

Officials need to assess the fallout of the US-Israel war on Iran, which has led to energy prices surging. <\/p>\n\n\n\n

Oil prices have jumped more than 40% since the fighting started on February 28, with Brent crude trading at over $100 a barrel, while the rand has also weakened sharply against the dollar.<\/p>\n\n\n\n

Central Bank Governor Lesetja Kganyago said South African inflation was more influenced by currency weakness than by oil prices.<\/p>\n\n\n\n

Investec Chief Economist Annabel Bishop said that the lagged effects mean that fuel price changes from the war will only be seen in April’s inflation figure. <\/p>\n\n\n\n

The petrol price dropped by 65 cents per litre in South Africa in February, adding to the downward pressure on inflation.<\/p>\n\n\n\n

However, April is set for a R4.74 per litre increase in petrol prices and a R7.73 per litre rise in the diesel price.<\/p>\n\n\n\n

Bishop said that the state may temporarily absorb some of these costs where it can do so.<\/p>\n\n\n\n

She added that consumer price inflation is forecast at 3.2% for Q1 2026, but will likely reach close to 4.0% in Q2 as fuel prices increase in the country. <\/p>\n\n\n\n

From an interest rate perspective, markets (as reflected in the forward rate agreement curve) expect the SARB to leave interest rates unchanged this month, which aligns with Investec’s view. <\/p>\n\n\n\n

The SARB’s Monetary Policy Committee (MPC) is scheduled to meet on Thursday, 26 March 2026. <\/p>\n\n\n

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\"\"<\/a><\/figure><\/div>\n\n\n

With reporting from Bloomberg<\/em><\/p>\n\n\n\n

\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Inflation has fallen squarely on the Reserve Bank’s target, but the war in the Middle East will likely stop any interest rate cuts. <\/p>\n","protected":false},"author":59,"featured_media":828563,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[1850,1498,1809],"class_list":["post-854302","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-bloomberg","tag-investec","tag-stats-sa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/854302","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=854302"}],"version-history":[{"count":4,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/854302\/revisions"}],"predecessor-version":[{"id":854311,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/854302\/revisions\/854311"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/828563"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=854302"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=854302"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=854302"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}