Although the latest inflation figure is lower than was expected, indicating that consumers have had more spending power, analysts say another interest rate cut is unlikely. Inflation fell to a seven-year low in March, moving further below the midpoint of the Reserve Bank’s target range of 3%-6%, slowing to 3.8% from a year earlier. Inflation was at 4% in February. The strengthening of the rand, which ended February 10.6% above its prior-year level versus the dollar, “has helped to alleviate inflation pressures”, said Sarah Quinlan, Mastercard senior vice-president and group head of market insights. The lower inflation rate has supported consumers’ purchasing power. Retail sales performed better than expected in February as well on declining inflation, increasing 4.9% year on year (R80.3bn) after a 3.2% year-on-year increase in January (R78.1bn). While the anticipated value-added tax (VAT) hike “may have boosted consumer spending in March”, it could “add to inflationary pressures in ...

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