
UASA Media Release: 30 January 2025
Image Source: South African Reserve Bank.
Statement by Abigail Moyo, spokesperson of the trade union UASA:
UASA acknowledges and welcomes the South African Reserve Bank’s (SARB) Monetary Policy Committee (MPC) decision to decrease the repo rate by 25 basis points to 7.5% following this afternoon’s meeting.
Although South Africa’s economy contracted in the third quarter of 2024 due to a significant drop in agricultural production, Governor Lesetja Kganyago explained that for the fourth quarter, a rebound is anticipated. This will be supported by more normal agricultural production and strong household spending, given tailwinds including lower inflation and Two-Pot pension withdrawals.
Last year, headline inflation averaged 4.4%, near the middle of the SARB target range of 4.5%. After starting the year above 5%, inflation slowed to 3% in December. This was due to favourable goods-price developments, including food inflation reaching 15-year lows and lower fuel costs.
However, Kganyago cautioned that US President Donald Trump’s recent import tariff policies may be inflationary and curtail future rate cuts. Following the rate cut announcement, the National Energy Regulator of South Africa granted Eskom an electricity tariff hike of 12.7% from 1 April 2025—another expense uncertainty that the economy poses to consumers. With the rate cut, the MPC hopes to achieve stability in pricing and an inflation rate consistent with economic activity across the board.
UASA calls on the government and relevant stakeholders to implement sustainable economic policies to drive job creation, economic growth, and financial relief for workers. We encourage our members to remain informed about financial planning strategies to mitigate the impact of interest rate decisions on their livelihoods.
For further enquiries or to set up a personal interview, contact Abigail Moyo at 065 170 0162.