Why SARB Will Cut Interest Rates in November 2025: A Data-Driven Prediction

•5 min read

The South African Reserve Bank (SARB) is set to announce its interest rate decision on Thursday, 27 November 2025. Based on the latest inflation data and SARB policy trends, I'm predicting a rate cut - and here's why the data supports this.

Want to see how rate changes affect you? Use the Interest Calculator to see how different interest rates impact your savings, or the Home Loan Calculator to calculate bond repayment changes.

The Prediction: A 0.25% Rate Cut

I'm predicting SARB will cut the repo rate by 0.25 percentage points at the November 2025 announcement. This would bring:

  • Repo rate: Down from 7.0% to 6.75%
  • Prime lending rate: Down from 10.5% to 10.25%

For homeowners with a R1 million bond, this means roughly R160-R180 less in monthly repayments.

Why a Rate Cut is Likely: The Data

1. Inflation is Well Within SARB's Target Range

The SARB aims to keep inflation between 3% and 6%. Let's look at where we are:

  • Current inflation (September 2025): 3.4%
  • October 2025 forecast (as of 5 November 2025): Most forecasts predict 3.4% - matching September's rate
  • 2025 average: Between 2.7% and 3.5%
  • Status: Comfortably within the target range

Note: October's CPI data will be released on Wednesday, 19 November 2025 (before the SARB announcement on 27 November). While the official data isn't available yet, most economic forecasts are predicting October inflation will match September's 3.4% rate, suggesting continued stability.

Inflation has been stable and low throughout 2025. After spiking to over 6% in 2022-2023, inflation has steadily declined and stabilized around 3-3.5% for the past year. This gives SARB room to cut rates without risking inflation getting out of control.

2. The Downward Trend Has Been Consistent

Looking at the monthly inflation data shows a clear pattern:

  • January 2025: 3.2%
  • March 2025: 2.7% (lowest point)
  • July 2025: 3.5% (slight uptick)
  • September 2025: 3.4% (stable)

The trend shows inflation is not only within target but stable. There's no upward pressure that would require keeping rates high.

3. SARB Has Been Cutting Rates Already

The interest rate trajectory tells its own story:

  • September 2024: Prime rate at 11.5%
  • November 2024: Cut to 11.25%
  • January 2025: Cut to 11.0%
  • May 2025: Cut to 10.75%
  • August 2025: Cut to 10.5%

SARB has been consistently cutting rates as inflation came down. The pattern suggests they're likely to continue this trend now that inflation is stable.

4. Economic Growth Needs Support

With inflation under control, SARB can focus on supporting economic growth. Lower interest rates:

  • Stimulate consumer spending
  • Reduce business borrowing costs
  • Support employment
  • Help reduce household debt burdens

South Africa's economy could benefit from a rate cut, and with inflation at 3.4%, there's minimal risk to price stability.

What About the Upside Risks?

Some economists worry about potential inflation risks:

  • Rand weakness: A weaker currency could push up import prices
  • Oil prices: Global energy price shocks could affect local inflation
  • Service inflation: Some services sectors still showing price pressures

However, these risks appear manageable at current levels. The SARB has shown it can act quickly if inflation picks up again, but with inflation at 3.4%, pre-emptive rate hikes seem unnecessary.

The Historical Context

Looking at SARB's past behavior when inflation was in this range:

  • When inflation was around 3-4% in 2020, SARB cut rates aggressively (prime rate dropped to 7%)
  • The current rate of 10.5% is still relatively high compared to historical norms
  • SARB has room to cut without risking inflation breaking out of the target range

What This Means for You

If You Have a Home Loan

A 0.25% cut would reduce your monthly repayment:

  • R500,000 bond: ~R80-90/month savings
  • R1 million bond: ~R160-180/month savings
  • R2 million bond: ~R320-360/month savings

Use the Home Loan Calculator to see your exact savings.

If You're Saving

Lower interest rates mean:

  • Lower returns on savings accounts and fixed deposits
  • More incentive to invest in growth assets (stocks, ETFs)
  • Better time to consider tax-free savings accounts (TFSAs) for long-term growth

Use the Interest Calculator to see how different interest rates affect your savings growth over time.

If You're Planning to Borrow

  • Better rates for new home loans
  • Lower costs for personal loans and credit
  • Opportunity to consolidate debt at lower rates

The Bottom Line

The data points strongly toward a rate cut:

✅ Inflation at 3.4% - well within SARB's 3-6% target
✅ Stable trend - no upward pressure
✅ Consistent pattern - SARB has been cutting rates
✅ Economic support needed - room to stimulate growth

While nothing is guaranteed, the probability of a rate cut is high. The SARB Monetary Policy Committee announces its decision on Thursday, 27 November 2025, at approximately 15:30 SAST.

Want to track the data yourself? Check out the Historical CPI & Inflation Data and Prime & Repo Rates pages to see how inflation and interest rates have moved over time.

Calculate the impact: Use the Interest Calculator to see how rate changes affect your savings, or the Home Loan Calculator to calculate bond repayment changes.

Disclaimer: This is not financial advice. Rate predictions are based on current data and trends. Actual SARB decisions may vary based on factors not covered in this analysis. Always consult with a qualified financial advisor for personalized advice.