SA’s inflation expectations dipped for Q1 - BER

JOHANNESBURG - The Bureau for Economic Research (BER) said the country’s inflation expectations dipped for the first quarter.

A poll by the Stellenbosch-based firm has revised inflation expectations for this year, next year and 2026 lower than previously anticipated.

This is expected to ease the pressure off the reserve bank when it meets to decide on the repo rate at a Monetary Policy Committee meeting next week.

The average headline inflation expectations made by analysts, the business sector and trade unions receded by 0.3% for 2024 and 2025.

Inflation is now expected to average 5.4% for this year, dropping from previous expectations of 5.7%.

When the reserve bank’s Monetary Policy Committee meets in about a week, it will weigh a combination of factors before deciding on the repo rate.

This includes inflation expectations, which generally give some insight about what inflation trends could look like in the future.

While the survey is a good sight, the lower inflation expectations alone are not enough to convince the central bank to loosen monetary policy.

The repo rate remains at a 14-year high of 8.25%.