South Africa Interest Rate

The South African Reserve Bank unanimously decided to maintain its key repo rate at 8.25% on March 27th, 2024, marking the fifth consecutive meeting at 2009-highs, as expected. Policymakers highlighted that, on balance, risks to the inflation outlook were skewed to the upside. Headline inflation accelerated for the second consecutive month, reaching 5.6% in February, up from January's 5.3%, nearing the upper limit of the central bank's target range of 3-6%. Forecasts now indicate that inflation is expected to reach the midpoint of its target range only by the end of 2025, later than previously predicted, as it was initially expected to occur by the middle of the year. The inflation projection for this year was slightly revised upward to 5.1%, compared to January's estimate of 5%. For 2025, it remained unchanged at 4.6%. Regarding economic activity, the SARB maintained its growth projections at 1.2% for 2024 but revised them upward to 1.4% for 2025, up from 1.3% earlier.