SARB warns of stagflation risk
The South African Reserve Bank (SARB) warned that the South African economy faced a stagflation risk due to sharply higher energy-related commodity prices and supply-chain disruptions. The SARB expects headline inflation to rise temporarily in the near term before returning to target from late 2027.
The South African Reserve Bank (SARB) has warned of a stagflation risk in the South African economy. The SARB cited sharply higher energy-related commodity prices and supply-chain disruptions as factors heightening near- to-medium-term stagflation concerns in its April 2026 Monetary Policy Review. Stagflation refers to a combination of economic stagnation and high inflation. The SARB expects headline inflation to rise temporarily in the near term as the oil shock feeds through, before returning to target from late 2027. The Iran war and ongoing trade tensions may accelerate the establishment of parallel supply chains, potentially raising inflation further. The risks of stagflation have risen substantially due to the impact of the closure of the Strait of Hormuz on oil prices and the supply disruption of petrochemicals.
This content was automatically generated and/or translated by AI. It may contain inaccuracies. Please refer to the original sources for verification.