20.04.2025
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Economist predicts Reserve Bank interest rate cuts in 2025

3 mins



  • Hand flipping wooden cube block to change between up and down with percentage sign symbol for increase and decrease financial interest rate

2 minutes

Independent Economist Elize Kruger says the Consumer Price Inflation (CPI) index surpassed analysts’ expectations in November. This is as data released by Stats SA shows that inflation increased by 2.9% in November, from 2.8% in October.

Stats SA notes that food inflation hit its lowest level in 14 years as vegetables, bread and cereal, hot and cold beverages, meat and eggs, among other foods, recorded price decreases.

Kruger forecasts that with the current inflation trend, the Reserve Bank may cut interest rates at least three times in 2025.

“Overall inflation in South Africa is well under control. If you look at these numbers also on an average basis, my forecast for 2024 is 4.4%. It’s slightly below the midpoint of our target and it’s very clear that the current level of interest rates in South Africa is unnecessary, and punitive if you look at the current environment of prices and inflation in South Africa. Therefore, I do believe there is ample scope for the Reserve Bank to cut interest rates further into the new year and I hope to see at least three to four, 25 basis point cuts in 2025.”

VIDEO | Executive for Financial Wellness and Advisory at Nedbank Dr Frank Magwegwe shares the same sentiment that the Reserve Bank is likely to cut interest rates further. 

Annual consumer inflation was 2,9% in November, slightly up from 2,8% in October:

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