South Africa Cuts Interest Rate to 7.75%

South Africa's central bank has cut its benchmark interest rate by 25 basis points to 7.75%, marking a cautious approach amid mixed economic data and global uncertainties. This decision follows a significant drop in inflation to 2.8% in October, the lowest in over four years, prompting some analysts to anticipate a larger cut. However, Governor Lesetja Kganyago emphasized the 'highly uncertain' global economic landscape and the potential for rising costs in essential areas like food and energy, which could impact future inflation. The rand strengthened slightly against the dollar following the announcement, reflecting market expectations. The central bank's cautious stance is further influenced by the unpredictability surrounding U.S. President-elect Donald Trump's policies and their potential effect on global trade. Overall, while the bank sees a gradual improvement in economic growth, it remains vigilant about external risks.