More good news about interest rate cuts in South Africa

South Africans look increasingly set to benefit from lower interest rates in 2026, with developments in the USA encouraging further cuts by the South African Reserve Bank (SARB).

South Africa has seen the repo rate drop to 6.75% over the last 15 months, with the SARB cutting interest rates from a high of 8.25% in September 2024.

Interest rate moves by the US Federal Reserve have a significant impact on decisions made by the SARB, as they affect the values of the rand and the dollar, respectively.

Investec Chief Economist Annabel Bishop stated that the recent acceleration in US interest rate cuts, following a pause in most of 2025, has led to a weaker dollar.

The rand has strengthened by over 10% against the dollar in the first few days of 2026 year-on-year, with much of this linked to the dollar weakness.

The rand’s strength against the US dollar is very beneficial for inflation, aiding in lowering price pressure on fuel and food.

The Rand’s strength against the US dollar tends to be a good sign for inflation, as imports become less expensive.

Source: Business tech