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BusinessLive reports that Standard Bank forecasts that the SA Reserve Bank (SARB) will cut its benchmark interest rate twice by the end of the year thanks to the outcome of last month’s elections.
Africa’s biggest lender by assets has pencilled in the first repo rate reduction in September as consensus builds in the financial services sector that help is on the way for embattled consumers. The lender’s CFO, Arno Daehnke, indicated: “We expect a continued commitment to the fiscal consolidation plan and ongoing traction to the growth-supportive reforms under way. This should support moderating inflation and monetary policy easing. We expect 100 basis points (bps) of cumulative interest rate cuts. But we expect them to be spread, with two cuts of 25bps in the second half of 2024, starting in September, and two cuts of 25bps in the first half of 2025.” The SARB’s monetary policy committee kept the repo rate at 8.25% for a sixth consecutive time at its most recent meeting in May. The committee’s next meeting is scheduled for 16-18 July. It was reported in May that SA’s four biggest banks had about R98bn in underperforming home loans, reflecting the effect of high interest rates on consumers.
- Read the full original of the report in the above regard by Kabelo Khumalo at BusinessLive
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