News about South Africa

The South African rand edged up roughly 0.2% in early Monday trade to 16.4475, as investors looked ahead to a busy week of economic data. The focus is on Finance Minister Enoch Godongwana's medium-term budget policy statement on Wednesday and September inflation figures. Nedbank expects headline inflation to rise to 4.8% in September from 4.4% in August, and retail sales growth to slow to 2.5% in August from 3.4% in July, with higher transport costs from fuel prices and rand depreciation as the main pressure. The 2035 benchmark government bond was little changed, with its yield rising half a basis point to 8.7%.

Finance Minister Enoch Godongwana is likely to trim his 2026 growth forecast, which was 1.6% in the February budget, in his medium-term budget policy statement to parliament on Wednesday. The US war against Iran has hurt manufacturing and mining and pushed inflation sharply higher, and the South African Reserve Bank and the IMF have already cut their forecasts significantly. Spending for the first five months of 2026/27 reached 42% of the budget versus 41% a year earlier, while revenue of R812bn trailed the R868bn implied by the main budget, according to Investec economist Annabel Bishop. This week, Sacci releases its September business confidence index on Monday, and Stats SA publishes September consumer inflation on Wednesday, with Absa economists expecting a 0.2 percentage point rise to 4.6% on fuel prices.

Cosatu's newly elected leadership, led by general secretary Zingiswa Losi, used its reconvened 15th National Congress to call for faster talks on the next phase of the two-pot retirement reform and for tax relief for highly indebted workers. Critics argue the system offers less relief than expected because withdrawals are taxed at marginal income tax rates. The federation also pledged to strengthen its living wage campaign, defend collective bargaining, oppose retrenchments, labour broking and outsourcing, and develop a workers' cost-of-living index. It further demands greater transparency in retirement funds, better tax thresholds, and more union representation on the board of the Public Investment Corporation, where the law allows three union representatives.