MNI SARB Preview - May 2025: Will SARB Resume Cuts?

Download Full Report Here

Executive Summary:

• Consensus is leaning towards a 25bp cut but some analysts are calling for a hold.
• Favourable short-term inflation developments give the MPC some comfort to ease policy.
• Longer-term uncertainty remains elevated, demanding cautious approach.

Consensus is leaning towards a 25bp cut at South African Reserve Bank’s (SARB’s) monetary policy meeting this week, as recent price dynamics have proven relatively benign, with headline inflation tracking below the +3.0-6.0% Y/Y target range. However, the wider perception is that it is a close call, with upside inflation risks further ahead and broader uncertainty around the outlook encouraging the Monetary Policy Committee (MPC) to remain cautious. In the meantime, SARB watchers will be on the lookout for any announcements surrounding ongoing talks with the National Treasury on the inflation target revision.