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SARB Repo Rate in South Africa
The South African Reserve Bank's policy rates from 2013 to 2022 reflected the country's economic challenges. Initially, rates were increased to combat inflation and stabilize the Rand. However, in 2020, in response to the COVID-19 economic fallout, rates were significantly reduced to historic lows to support economic growth. By 2022, as the economy began recovering and inflationary pressures emerged, the central bank started increasing rates.
The SARB Repo Rate ended 2022 at 7.00%, up from the 3.75% end-2021 value and higher than the reading of 5.00% a decade earlier. For reference, the average policy rate in Sub-Saharan Africa was 11.80% at the end of 2022. For more interest rate information, visit our dedicated page.
South Africa Interest Rate Chart
Note: This chart displays Policy Interest Rate (%) for South Africa from 2014 to 2023.
Source: Macrobond.
South Africa Interest Rate Data
| 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|
| SARB Repo Rate (%, eop) | 6.50 | 3.50 | 3.75 | 7.00 | 8.25 |
| 3-Month JIBAR (%, eop) | 7.16 | 3.87 | 3.85 | 6.50 | 8.43 |
| 10-Year Bond Yield (%, eop) | 9.02 | 9.70 | 9.82 | 11.30 | 11.33 |
SARB kicks off long-awaited loosening cycle in September
First rate cut in four years: At its meeting on 19 September, the South African Reserve Bank (SARB) decided to reduce the repurchase rate by 25 basis points to 8.00%. The reduction, which was the first since 2020, had been priced in by markets.
Improved inflationary outlook: The decision to begin cutting rates was driven by inflation recently moving closer to the midpoint of the 3.0–6.0% target band, and the Bank downwardly revising its forecasts for both headline and core inflation for 2024–2026; price pressures are expected by the Bank to average below 4.5% in both 2025 and 2026. Moreover, output was below the SARB’s projections in H1, and investment remained a concern as it has contracted for four quarters in a row, suggesting monetary stimulus might be needed to support the economy. Regarding activity, the SARB kept its 2024 GDP growth forecast unchanged at 1.1%, and upped its projections for both 2025 and 2026 by 0.1 percentage point to 1.6% and 1.8%, respectively.
Market expects another same-sized cut in Q4: In its forward guidance, the SARB suggested the repurchase rate could stabilize slightly above 7.00% in 2025—in line with our Consensus—but reiterated that decisions will remain data-dependent and conditional on the balance of risks to the inflation outlook. All of our panelists—bar one—have penciled another 25 basis points of cuts at the SARB’s next and final meeting of the year, scheduled for 21 November.
Panelist insight: Andrew Matheny, economist at Goldman Sachs, said: “Given the downside surprises to South African inflation in recent months, strengthening of the Rand, and supportive external backdrop, we revise our policy rate forecast by front-loading rate cuts (maintaining the same terminal rate forecast of 6.5%). […] Our new forecast implies that the terminal rate will be reached in Q3 2025 as compared to Q1 2026 previously.”
Consensus Forecasts and Projections for the next ten years
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects South African interest rate projections for the next ten years from a panel of 16 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable interest rate forecast available for South African interest rate.
Download one of our sample reports to visualize what a Consensus Forecast is and see our South African interest rate projections.
Want to get access to the full dataset of South African interest rate forecasts? Send an email to info@focus-economics.com.
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