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Prospect of South African Rate Cuts Stirs Hope for Battered Retail Stocks

  • Most economists expect benchmark rate reduction Thursday
  • Spending power set to rise as consumers spend less on interest
Retail At Shoprite Holding Ltd.'s OK Furniture And House & Home Stores
Photographer: Dean Hutton
Updated on

It’s been a tough year for South African retail stocks, battered by gloomy economic news. But hope is on the way.

The South African Reserve Bank is expected to reduce its key interest rate Thursday for the first time since March 2018, starting a series of cuts that economists forecast could total as much as 75 basis points over six months. That would support a fragile recovery in sales and consumer confidence by loosening the cost of debt.