The South African Reserve Bank raised the policy rate to 7.25 percent
The Monetary Policy Committee raised the policy rate by 25 basis points to 7.25 percent, unanimously, effective 25 September. Headline inflation is 4.4 percent. All six members voted for the increase. The prime rate moves to 10.75 percent, and this is the second hike this year after May's move to 7 percent.
Economics & Markets··Night
A unanimous quarter point, effective 25 September
The Monetary Policy Committee raised the rate by 25 basis points to 7.25 percent, unanimously. The decision takes effect on 25 September. Headline inflation is 4.4 percent. Financial Mail reports that all six members voted for the increase, so the unanimous result is a 6-0 count rather than a phrase alone. The prime rate moves to 10.75 percent. It is the second hike this year, after the May increase to 7 percent. In July, two of the six members had wanted a hike and did not get one. The Wednesday vote is the meeting at which the six agreed. A reader can place July's 2-of-6 beside September's 6-of-6 without treating them as the same decision.[1], [2]
What Kganyago put next to the hike
Lesetja Kganyago said the economy contracted 0.2 percent in the second quarter and that growth for the year is projected at 1.2 percent. Medium-term growth is around 2 percent. He said petrol shows an average under-recovery of 2.83 rand per litre. He said headline inflation will move above 5 percent later this year and will be back around 3 percent toward the end of 2027. He added that the fuel shock has intensified and that global rates are moving higher. Those sentences are the governor's account of the backdrop, published with the 25 basis-point decision. The 7.25 percent rate is the decision. The 4.4 percent inflation reading is the current headline. The path he described, above 5 percent and then around 3 percent, is a projection he stated, not a second vote.[1], [2]
July's minority and May's earlier step
Financial Mail places Wednesday's unanimous vote as the second hike this year. The earlier step was the May increase to 7 percent. In July, two of the six members had wanted a hike. The September count is all six. The prime rate that follows the policy rate is 10.75 percent. The policy rate itself is 7.25 percent, from a 25 basis-point move, effective 25 September, with headline inflation at 4.4 percent. Kganyago's petrol figure, an average under-recovery of 2.83 rand per litre, sits in the same statement as the fuel-shock sentence. The vote Financial Mail counted, 6 for the hike, is the committee arithmetic behind the word unanimous.[1], [2]
