South Africa Inflation Eases to 3.5%, Rate Cut Speculated

South Africa’s inflation slows, bringing relief to consumers while policymakers weigh interest rate adjustments amid mixed price pressures.

South Africa’s annual inflation fell to 3.5% in January 2026, down from 3.6% in December, approaching the 3% central bank target. While staples like rice, maize meal, and dairy saw price declines, meat costs surged to 13.5%, the highest since 2017, keeping household budgets strained.

The South African Reserve Bank has maintained its benchmark rate at 6.75%, signaling caution amid global and domestic risks. The January data, however, strengthens expectations of a possible rate cut when the Monetary Policy Committee meets on March 26, 2026.

Regionally, Nigeria also saw slight inflation moderation (15.10% from 15.15%), highlighting Africa’s central banks balancing easing with macroeconomic uncertainties.