The South African Reserve Bank (SARB) on Thursday reduced the repo rate by 25 basis points, lowering it from 7.25% to 7%, a move that offers financial relief for homeowners and prospective property buyers.
The prime lending rate has also decreased to 10.5%.
The decision was announced following the conclusion of the Monetary Policy Committee (MPC) meeting, with all six members voting unanimously in favour of the rate cut.
The adjustment aligns with the expectations of most economists and analysts, who had anticipated a small cut despite the backdrop of global uncertainty, particularly the looming imposition of a 30% tariff on South African exports to the United States starting on Friday, 1 August.
Global and Local Pressures
SARB Governor Lesetja Kganyago noted that global economic conditions remain volatile, with the US tariff escalation creating further instability.
At the same time, South Africa’s domestic economy continues to struggle, justifying the MPC’s move to provide some support through monetary easing.
While some experts had forecast a pause in rate changes to assess the fallout from the impending tariffs, the SARB opted to act now, viewing the current environment as an opportunity to stimulate the economy without stoking inflation.
The rate cut marks a continuation of the bank’s cautious easing cycle and could be the final adjustment for some time, depending on how global trade dynamics and domestic inflation unfold in the months ahead.
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 in 2025 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 position of governor of the SARB – and the deciding vote if necessary.
| Month | Date | Outcome |
| January | 30 January | 25 basis point cut |
| March | 20 March | No change |
| May | 29 May | 25 basis point cut |
| July | 31 July | 25 basis point cut |
| September | 18 September | TBA |
| November | 20 November | TBA |
Monthly bond repayment table
The table below shows the now old monthly bond repayments on various bond values over a 20-year period assuming no deposit and repayments at prime.
It also shows the new monthly bond repayments after the 25 basis point cut as well as what the monthly saving will be.
| Bond | Old | New | Saving |
| R750 000 | R7 614 | R7 488 | R126 |
| R800 000 | R8 122 | R7 987 | R135 |
| R850 000 | R8 629 | R8 486 | R143 |
| R900 000 | R9 137 | R8 985 | R152 |
| R950 000 | R9 645 | R9 485 | R160 |
| R1 000 000 | R10 152 | R9 984 | R168 |
| R1 500 000 | R15 228 | R14 976 | R252 |
| R2 000 000 | R20 305 | R19 968 | R337 |
| R2 500 000 | R25 381 | R24 960 | R421 |
| R3 000 000 | R30 457 | R29 951 | R516 |
| R3 500 000 | R35 533 | R34 943 | R590 |
| R4 000 000 | R40 609 | R39 935 | R684 |
| R4 500 000 | R45 685 | R44 927 | R758 |
| R5 000 000 | R50 761 | R49 919 | R842 |
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