The Monetary Policy Committee (MPC) has cut interest rates by another 0,5 basis points on Thursday, effective on the 01st of August 2025.
Lesetja Kganyago, the Governor of the Reserve Bank (SARB), said the decision was made at the back of growth reported at just 0.1% by StatsSA.
There was also a downward revision to earlier GDP data, along with an assumption of higher US tariffs on South Africa.
“This has caused us to mark down our 2025 growth forecast. That said, the recent data flow has been positive, suggesting that the economy picked up in the second quarter of the year” said Kganyago.
The economy’s underlying growth trend remains low, mainly due to persistent supply-side problems, including logistics.
He also said the consumer confidence deteriorated in the first half of this year.
“However, we still expect modestly higher growth in the coming years, supported by ongoing structural reforms.”
The rand has strengthened and inflation expectations have moderated, according to June CPI print, which also illustrated headline inflation at 3% and core at 2.9%.
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