South Africa Central Bank Cuts Rate 25 Bps to 7.00% in 4-2 Vote
Updated
Updated · investinglive.com · Jul 26
South Africa Central Bank Cuts Rate 25 Bps to 7.00% in 4-2 Vote
3 articles · Updated · investinglive.com · Jul 26
Summary
South Africa's central bank cut its policy rate by 25 basis points to 7.00%, an unexpected move that split policymakers 4-2.
The bank said policy was already restrictive enough to bring inflation back to target within two years, even as it acknowledged stronger underlying price pressures and upside inflation risks.
The decision hit the rand because higher oil prices were already raising concern about imported inflation in South Africa.
SARB also added an adverse scenario in which oil averages $100 a barrel in 2026, inflation stays above target and another rate hike is needed later this year.
In updated forecasts, the bank lowered its 2026 CPI view, raised its 2027 inflation forecast, lifted its 2026 growth outlook and still flagged downside risks to growth.