JOHANNESBURG (Reuters) -The South African rand slipped on Wednesday after September headline inflation ticked up, but the increase was smaller than expected, bolstering the case for the central bank to resume rate cuts.
At 1255 GMT the rand traded at 17.46 against the dollar, about 0.5% down from its Tuesday close.
Headline consumer inflation quickened to 3.4% in annual terms from 3.3% in August, below the median forecast of 3.5% in a Reuters poll.
The South African Reserve Bank has already delivered three interest rate cuts this year, but it paused at its last policy meeting in September to assess the impact of previous cuts.
“In our view, dovish inflation developments since September are likely to support a 25bp rate cut from the SARB at its upcoming November MPC meeting,” said Andrew Matheny, South Africa Economist at Goldman Sachs.
The SARB’s next monetary policy announcement is scheduled for November 20.
On the Johannesburg Stock Exchange, the Top-40 index was last down 0.6%.
The benchmark 2035 government bond was also down, with the yield up 3 basis points at 8.94%.
(Reporting by Sfundo Parakozov and Anathi Madubela;Editing by Alexander Winning and Alex Richardson)
