A quick word on interest rates

A quick word on interest rates

• The South African Reserve Bank (SARB) held its May MPC on 29 May 2025, opting for a 25 basis-point reduction in the repo rate to 7.25% effective 30 May.
• This brought the prime lending rate down to 10.75% as of 20 June 2025. (Prime is essentially the cost of borrowing and is particularly relevant to our business because it determines the price of home loans)
• From what we’re seeing in the market, buyers and sellers are under pressure. Disposable income is tight, and affordability remains a major hurdle.
• This rate cut provides much-needed relief for households and stimulates activity — and there’s little doubt that all South Africans could use a boost sooner rather than later.
• Inflation has remained stable at around 2.8%, sitting at the lower bound of the SARB’s official 3–6% range.
• The next MPC meeting is set for 17 July 2025, and most economists and banks anticipate no change at that session. However, many forecast cumulative easing of at least 50 basis points by year‑end.