SARB likely to cut rates 25bps to 7.75% later this month

By Vuyani Ndaba

The South African Reserve Bank will cut its repo rate next week as slowing inflation continues to make way for a series of cuts through the middle of next year, spurring growth to almost 2%, a Reuters poll suggested.

All but two of 22 economists surveyed in the past week said the South African Reserve Bank (SARB) would cut rates by 25 basis points (bps) to 7.75% at its Nov. 21 meeting. Two expected a 50bps cut.

The repo rate is expected to fall again by 50bps in either one move or cumulatively in January and March, followed by a 25bps cut at the May meeting to reach 7.00%.

“We anticipate a second 25bps cut at the November meeting, supported by the dip in September headline inflation, core inflation remaining slightly below the mid-point of the target range, and continued risks for moderate output growth,” Dennis Shen,