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Government welcomes the decision by the Monetary Policy Committee (MPC) of the South African Reserve Bank (SARB) to lower the repo rate by 25 basis points, thus shifting the prime lending rate to 11.5%. The cut provides much-needed relief to businesses and households as the economy continues to recover from recent challenges.

The positive move by the SARB comes at a time when economic indicators are showing encouraging signs of stability. On Wednesday (18 September 2024), Statistics South Africa announced that the Consumer Price Inflation (CPI) had softened for the third consecutive month, with August recording a CPI of 4.4%. This marks a marginal decline from the 4.6% observed in July and reflects ongoing efforts to stabilise price pressures and ease the cost of living for South African households. 

Government Communication and Information System Acting Director-General, Nomonde Mnukwa said: "The reduction in the interest rate and the sustained decline in inflation provide a welcome reprieve for our citizens. These combined factors are not only helping to lower the cost of borrowing but also offer significant relief to households struggling with high costs of living. While challenges still remain, the reduction reflects our commitment to stabilising the economy and supporting household incomes. It is also inspiring to note that the inflation rate now falls comfortably within the South African Reserve Bank's target range of 3% to 6%, allowing more room for economic planning and investment.”

Government is constantly supporting policies that strengthen economic stability and enhance the well-being of all South Africans and will continue to ensure that the positive inflation trend is maintained while addressing challenges faced by other sectors of the economy. 

Issued by Government Communication and Information System