UASA Media Release: 30 May 2025
Statement by Abigail Moyo, spokesperson of the trade union UASA:
In a positive development for workers struggling with debt, the Monetary Policy Committee (MPC) of the South African Reserve Bank (SARB) lowered the repo rate by 25 basis points to 7.25%.
This decision, along with a more favourable outlook for consumer price inflation (CPI), suggests the possibility of another 25-basis-point reduction later in the year, provided that both global and domestic conditions continue to support a low CPI.
Lesetja Kganyago, the governor of the SARB, announced that South Africa is likely to move towards a lower CPI target. The current target range of 3% to 6%, with a goal of 4.5%, is expected to be adjusted to 3% or, at the very least, to a range where 3% becomes the primary measure.
Kganyago indicated that a 3% target would align South Africa’s CPI with that of other emerging markets, eventually leading to lower interest rates.
The MPC made its decision against a backdrop of lower projected economic growth both globally and domestically.
The SARB revised its global growth forecasts for 2025 and 2026, from 3.1% to 2.5% and from 3.1% to 2.9%, respectively. Similarly, South Africa’s economic growth estimates have been lowered from 1.7% to 1.2% for 2025, from 1.8% to 1.5% for 2026, and from 2.0% to 1.8% for 2027.
Unfortunately, these downward adjustments may lead to a potential decrease in job creation and an increase in unemployment rates.
For further enquiries or to set up a personal interview, contact Abigail Moyo at 065 170 0162.