The South African Reserve Bank's Monetary Policy Committee voted 3-2 to hold the repo rate at 8.25% at its March 27, 2026 meeting. Prime lending rate remains at 11.75%. The two dissenters voted for a 25bp cut citing the February CPI of 3.9%, already below the 4.5% midpoint of SARB's 3-6% target range.
Bond-market reaction
SA 10-year government bond yield dropped 14bp to 9.42% on the decision, as the market read the dovish dissent as a signal of a Q2 cut. The ZAR strengthened against the USD by 0.6% intraday.
Home-loan impact
For a R1.5m home loan at 11.75% prime over 20 years, the monthly bond repayment is R16,264. A 25bp cut (the market's Q2 base case) would bring this to R15,999 — R265/month saving, or R63,600 over the full term.
If your loan is prime-linked (most SA home loans are), there's no action this month. Your repayment stays put until SARB cuts, at which point banks pass through within 30 days.
Fixed deposit savers
12-month FD rates at major banks (FNB, Standard, ABSA, Nedbank) remain in the 8.10%-8.65% range. If you lock now at a fixed rate and SARB cuts, your deposit keeps the higher yield — a mild advantage for savers considering duration.
What Governor Kganyago signalled
Statement language softened around "restrictive" policy stance. The Committee highlighted persistent services inflation and administered-price risks (electricity tariff hikes from NERSA, water in metros) as reasons for caution despite headline CPI softness.
Budget Speech context
The 2026 Budget Speech was delivered February 19, 2026 — VAT stayed at 15% (after the failed 0.5pp hike attempt). Medical Tax Credit held at R364/R246. Fiscal drag via non-indexed tax brackets continues to lift effective rates by roughly 1.5% for middle earners.
Next MPC
Thursday, May 29, 2026. Markets price in a 70% chance of a 25bp cut.
What to do
1. If refinancing, model both current rate and a 50bp cut scenario in our bond calculator. 2. Savers: consider laddering 6/12/18-month fixed deposits to capture current rates. 3. If you have a prime-linked home loan with over 10 years remaining, a R500-R1,000/month extra payment shortens the tenure by 3-4 years at current rates.