The South African Reserve Bank (SARB) kept interest rates unchanged on Thursday, citing heightened uncertainty in global financial markets driven by escalating conflict in the Middle East.
The central bank’s Monetary Policy Committee (MPC) voted unanimously to hold the repo rate at 6.75%, leaving the prime lending rate at 10.25%.
The decision was widely expected by economists, but the bank signalled that rate hikes could still be on the horizon if conditions worsen.
“The South African Reserve Bank’s decision to hold the repo rate at 6.75% highlights a cautious approach amid global economic uncertainty,” said Terence Hove, Senior Financial Markets Strategist at Exness.
“While recent data from Statistics South Africa showed February consumer inflation cooling to exactly 3.0%, perfectly aligning with the central bank’s target, policymakers remain hyper-focused on upside risks from geopolitical tensions.
“The SARB is clearly prioritising long-term price stability over premature easing, waiting for clearer signals before committing to a rate-cutting cycle,” Hove added.
Global Conflict Drives Uncertainty
The outlook for South Africa has deteriorated due to geopolitical tensions involving the United States, Israel, and Iran, which have disrupted global energy markets.
Oil prices have surged and financial markets have turned risk-averse, weakening the rand and placing pressure on local assets.
South Africans are now bracing for record fuel price hikes, with petrol expected to rise by more than R5.70 per litre and diesel by around R10.
Inflation Risks Tilt Higher
SARB Governor Lesetja Kganyago warned that the conflict represents a supply shock, pushing prices higher while dampening demand.
While the bank typically looks through short-term price spikes, it remains concerned about second-round effects, where initial increases feed into broader inflation.
“The coming months will be crucial for assessing the longer-term inflation consequences,” Kganyago said in delivering the announcement.
Rate Hikes Back on the Table
Kganyago outlined two risk scenarios – both pointing to possible interest rate hikes.
A shorter conflict could result in one hike, while a prolonged war with sustained high oil prices and a weaker rand could require multiple increases.
In both cases, inflation is expected to rise above target before gradually easing back toward 3% over the next two years.
Despite the uncertainty, the SARB reiterated its commitment to price stability, signalling it stands ready to act to keep inflation under control.
Read the full MPC statement HERE
Who are the SARB’s MPC?
The South African Reserve Bank’s monetary policy committee meets every second month to announce changes – if any – to the country’s repo and prime lending rates.
The meetings are scheduled to take place in January, March, May, July, September and November – and always on a Thursday at 15:00.
Currently, the committee comprises of six people, with Lesetja Kganyago holding the deciding vote if necessary.
Dates for SARB MPC meeting dates in 2026
| Month | Date | Outcome |
| January | 29 January | No change |
| March | 26 March | No change |
| May | 28 May | TBA |
| July | 23 July | TBA |
| September | 23 September | TBA |
| November | 19 November | TBA |
Monthly bond repayment table
The table below shows the monthly bond repayments on various bond values over a 20-year period assuming no deposit and repayments at prime.
| Bond | Repayment |
| R750 000 | R7 362 |
| R800 000 | R7 853 |
| R850 000 | R8 344 |
| R900 000 | R8 835 |
| R950 000 | R9 326 |
| R1 000 000 | R9 816 |
| R1 500 000 | R14 725 |
| R2 000 000 | R19 633 |
| R2 500 000 | R24 541 |
| R3 000 000 | R29 449 |
| R3 500 000 | R34 358 |
| R4 000 000 | R39 266 |
| R4 500 000 | R44 174 |
| R5 000 000 | R49 082 |
