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Financial News

The annual consumer price inflation percentage has dropped to 3.8% (during Sept) for the first time in more than 3 years.

This occurred largely because of lower international rates for oil and its effect on transport. Food inflation rates also stayed pretty consistent at 4.7% and the averaged electrical increase sitting at 1.1%. The rand has also been doing well post elections and with all the chaos of the US elections pending.

What this means is that the inflation figures remain nice and snug within the lower end of the stated inflation target of the SARB Monetary Policy Committee (3-6%). It also points to a possible excuse for the MPC to make another small rate cut on November 21st.

It is likely they will not decide to make a massive cut due to the expected pressure on the Rand that will follow the outcome of the US elections and the building conflict in the middle east (which impacts on oil prices).

Lower interest rates generally mean a few more bucks in the pocket for those with big debts that they can then go instead spend in their local area, encouraging economic growth.