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South Africa’s inflation rate declined to a more than four-year low, heralding another reduction in borrowing costs today.
Consumer prices rose 2,8 percent in October from a year earlier, compared with 3,8 percent in the prior month, Pretoria-based Statistics South Africa said Wednesday in a statement on its website.
That was slower than the 3 percent median estimate of 15 economists in a Bloomberg survey.
The slowdown to below the lower end of the central bank’s 3 percent to 6 percent target range will likely persuade its monetary policy committee to ease monetary policy for the second time in as many months.
All 20 economists polled in a separate Bloomberg survey expect the MPC to cut the benchmark rate by a quarter-point to 7,75pc today.
Still, Governor Lesetja Kganyago will probably reiterate that future decisions will be data dependent with new inflation risks emerging.
The rand has depreciated almost 3 percent against the dollar since Donald Trump won the US election.
The currency has also been undermined by risk-off sentiment toward emerging market assets, after Russia’s war with Ukraine entered a dangerous new phase this week when Ukrainian forces carried out their first strike on a border region in Russia using Western-supplied missiles. -Bloomberg
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