Reserve Bank could cut rates by 125 basis points in 2024, says Old Mutual

Old Mutual Investment Group (OMIG) says South African interest rates could be cut by as much as 100 to 125 basis points in 2024 due to easing inflation and slowing economic growth.

The asset management unit of Old Mutual group says inflation is likely to fall back to about 4.5% by the middle of 2024, the midpoint of the SA Reserve Bank's (SARB) 3% to 6% target range.

While OMIG says the SARB is likely to wait until after Finance Minister Enoch Godongwana's 2024 budget speech to gauge the market's reaction before it begins cutting rates, it believes it may be bold enough to cut before the US Federal Reserve.