Finance News Update | 20 Feb 2020

General Headlines New social grant for South Africa is coming The Social Relief of Distress (SRD) grant, which pays R370 per month, has been extended until March 2027. Originally introduced during the COVID-19 pandemic to help unemployed and struggling South Africans, it started at R350 and later increased to R370. Although meant to be temporary, over 8 million people rely on it, so the government has kept extending it. The Treasury had planned for it to end in March 2026, but the Department of Social Development has confirmed it will continue for another year while a new replacement grant is developed. (BusinessTech) Markets and Investments Araxi to expand payments capabilities with R1bn Pay@ Group buyout Araxi, a payments solutions company, is buying Pay@ Group for R1‑billion. The deal will strengthen Araxi’s services and expand its reach in South Africa and beyond. Pay@ is South Africa’s largest independent payment platform, with thousands of retail and mobile payment points, and it processed over R60‑billion in the past year. The company is profitable, debt‑free, and growing quickly, with strong revenue and profit increases. Its management team will stay on after the acquisition to help expand the business into new markets and services. (Engineering News) South Africa consumer inflation falls to 3.5% y/y in January South Africa’s inflation eased to 3.5% in January, down slightly from December’s 3.6%, staying close to the central bank’s 3% target range. Housing, food, and insurance costs were the main drivers. Economists expect inflation to dip below 3% later this year, which could allow for interest rate cuts. Some analysts see a 25‑basis‑point cut at the March meeting, though rising core inflation (3.4% in January, the highest in 11 months) may cause hesitation. Looking ahead, lower oil prices, spare economic capacity, and a strong rand could support up to 100 basis points of cuts during 2026. (Engineering News) Investors pile into South African bonds at weekly debt sale Investor demand for South Africa’s government bonds surged at the latest auction, with bids nearly five times higher than the R3 billion offered. Long‑term bonds, especially those maturing in 2044, drew strong interest, showing confidence in the country’s fiscal outlook ahead of the upcoming budget. Analysts say higher commodity revenues could reduce debt issuance, making the budget more market‑friendly. The strong demand suggests investors see South Africa as stable and investable, though this depends on the government delivering promised reforms. Bond yields fell to their lowest level since 2015, reflecting improved sentiment. (Moneyweb) Property and Real Estates SA listed property moves from headwinds to momentum as discounts narrow

South Africa’s listed property sector is recovering after years of weak demand and high interest rates. It is now trading close to its net asset value, showing stronger investor confidence. Companies like Vukile, Growthpoint, and Hyprop have been active in buying and selling properties, shifting capital to strengthen their businesses. This mix of acquisitions and disposals signals that the sector is moving from survival mode to renewed growth and momentum. (BusinessTech)