US consumer prices held steady at 2.7% in July, matching June’s figure and sitting just below the 2.8% market consensus. The flat reading calmed fears of a renewed price surge, even as housing costs continued to climb. Cheaper fuel and stable food bills helped offset the underlying pressure, prompting markets to price in a stronger chance of a US interest rate cut as soon as September.

In response, the dollar slipped 0.33% against its main trading currencies.

But Federal Reserve projections still see inflation closing 2025 near 3%, comfortably above the official 2% target, which is a warning that any US easing will be cautious and gradual.

For South Africa, the US rate outlook remains pivotal. The Reserve Bank often mirrors Federal Reserve moves, but as US rates are expected to stay well above long-term norms, the scope for further rate cuts in South Africa will remain limited, supporting GDP growth projections of 0.8% for 2025.