South Africa’s central bank maintains its main interest rate at 8.25%, citing the need for a restrictive stance due to high inflation expectations. February’s inflation hit 5.6% year-on-year, near the top of the target range. Inflation is expected to reach the midpoint of 4.5% by end of 2025. Economic growth forecasts for 2024 and 2025 remain unchanged at 1.2% and 1.4% respectively. Rolling power cuts are anticipated to impact growth by 0.6 percentage points this year, falling to 0.2 percentage points next year. Analysts foresee potential interest rate cuts in the third quarter, with expectations of a drop to 7.50% by November.
