BusinessDayTV Sep 18, 2026
With Shaun Dendere of L7 Prime
Shaun Dendere of L7 Prime expects South Africa's Reserve Bank to raise interest rates at next week's meeting, and said so on BusinessDayTV with the word "unfortunately" attached.
The week gave him two reasons to expect relief instead. Saudi Arabia said there would be no supply disruptions and oil came off its highs, which in the ordinary course takes pressure off the fuel price and the consumer. Dendere does not think that lasts.
"I don't think that it is a relief. It is a temporary relief, in my opinion."
Dendere covers the Johannesburg market for L7 Prime and was on the program the day the Federal Reserve's hike and the Bank of Japan's hike had both landed, a week before South Africa's own monetary policy meeting.
The full segment is covered here so you can skip it.
Here are the 6 takeaways that matter.
Key Takeaways
He expects South Africa's Reserve Bank to raise rates next week to hold down the inflation that higher fuel prices would feed
The oil pullback came from Saudi Arabia confirming no supply disruptions, which he treats as temporary while Middle East tension is unresolved
The Federal Reserve's 25 basis point hike is the move he says hammered equity markets, and the JSE follows the American market closely
Japanese interest rates are at their highest in 30 years, which he reads as a medium-term signal on inflation rather than a Japanese story
Price data reaches consumers late, because oil, inflation and rate decisions all work with a lag
His pick is a gold ETF, chosen as a traditional safe haven rather than on any view about the metal
1. The JSE Mirrors the US
Asked for his read on the Johannesburg Stock Exchange this week, Dendere named the same three pressures the market has been carrying.
What has not gone away
This week has been really interesting in the sense that we are still dealing with geopolitical tensions.
Shaun Dendere
Inflationary pressure and oil are the other two, he said. The reason an American rate decision sets the tone locally is the correlation between the two markets.
The mechanism is a linked market
And as we know, the JSE almost mirrors what happens in the United States.
Shaun Dendere
And the American decision this week
So, the Fed increase interest rates by 25 basis points early in the week, which really hammers down on equity markets.
Shaun Dendere
High rates put equity markets under strain, he said, and that showed up on the JSE. What happens at South Africa's own policy meeting next week is the thing he is watching for the local index.
2. Oil's Temporary Relief
The host noted that oil has been the talk of the town since the Middle East disruption began and has now pulled back from recent highs, and asked whether that is meaningful relief for inflation and consumers or a pause before the next leg up. Dendere gave the reason for the fall first.
Why the price came down
All right, so from the oil perspective, we see that Saudi Arabia has essentially confirmed that there won't be supply disruptions, which has led to the market reacting, and we're seeing a lower oil price.
Shaun Dendere
The tension itself has not been resolved, he said, which is why he would keep watching rather than treat the level as settled.
What he expects the price to do
I think the oil price is going to be quite lopsided, up and down.
Shaun Dendere
His answer to the question as asked
I don't think that it is a relief. It is a temporary relief, in my opinion.
Shaun Dendere
3. From the Pump to Prices
Asked how significant lower oil prices could be for the rand, for inflation and for the Reserve Bank's decision, Dendere traced the route the oil price takes into South African prices.
It starts at the pump
As we all know, the oil price does affect the price at the actual pump in South Africa.
Shaun Dendere
And spreads from there
Higher oil prices lead to higher fuel prices, which then has a knock-on effect on consumer prices in terms of retail and transportation, etc., and so on and so forth.
Shaun Dendere
That is why he thinks the country is carrying real inflationary pressure, and it is the basis of his call on next week's meeting.
His rate call, with the word he chose
I'm of the view that in order to tame this potential inflation increase, I do believe that the Reserve Bank next week would be increasing those interest rates, unfortunately.
Shaun Dendere
4. What the SARB Will Weigh
The host said a forecast like that makes the heart sink given the pressure already on consumers, and asked which data points decide it. Dendere said it comes back to the inflation outlook, and named the consumer and producer price indexes as the pricing data the Reserve Bank has to take into account.
He conceded the cost of his own call
In my view, it is hard on the consumer from an industry perspective.
Shaun Dendere
The other side is growth. South Africa is struggling with gross domestic product growth, he said, and a rate decision has to keep the economy from falling by the wayside as well as hold prices down.
The trade-off he says the Reserve Bank faces
So, it is a balancing act of how do you save the economy, but while we're also seeing how do we protect the consumer in the long run?
Shaun Dendere
5. Japan at a 30-Year High
The host put the Bank of Japan's new policy rate at 1.25% and noted the Federal Reserve's 25 basis point increase in the same week, then asked how much further tightening markets might be pricing and what central banks do in the medium term. Dendere took Japan as the more telling of the two.
The level is the news
So, if we look at the Bank of Japan, right? the interest rates in Japan are the highest they've ever been in 30 years, which is quite interesting.
Shaun Dendere
Japan has had historically low rates, he said, so a rate at that level is a signal about the medium term rather than a local adjustment. The American side pointed the same way.
The Fed chair's tone
We saw the Fed chair still giving a hawkish turn with regards to what is happening in the future.
Shaun Dendere
What he takes from the pair
So, I am of the view that we definitely need to tighten our belts because this is not a scenario that is going to end anytime soon.
Shaun Dendere
He added the point that makes the timing hard to read: oil, inflation and rates all work with a lag.
The consumer feels it later
So, these numbers are being produced right now. However, the consumer sees it down the line.
Shaun Dendere
That is why he pushed his view out to the medium and long term and described a bumpy ride on inflation. He attached one condition to all of it.
The variable everything depends on
But it comes down to the geopolitical landscape that we are currently experiencing.
Shaun Dendere
If that changes, he said, the rest of what the segment covered eases with it.
6. A Gold ETF
Asked for a stock pick, Dendere did not give one. He took an exchange-traded fund holding gold.
The reason is the list of unknowns
I am taking a gold ETF. The reason I'm taking gold ETF, it goes back to the uncertainty that we are seeing with inflation geopolitics interest rates, and so on and so forth.
Shaun Dendere
And the label he put on it
So, just taking a traditional safe haven asset in this time that we living in.
Shaun Dendere
He gave no fund, no ticker and no price target, and made no claim about where the gold price goes.
Bonus Insights
Every one of Dendere's answers came back to the same single variable. Oil, South African inflation, the rate decision and his stock pick were all framed as functions of unresolved Middle East tension rather than of anything domestic.
He was also explicit about the discomfort of his own forecast, agreeing with the host that a rate increase is hard on consumers while holding to it as the likely outcome.
Dendere's bottom line is that the oil pullback buys South Africa a few weeks rather than a turn, that the Reserve Bank raises rates next week as a result, and that the position to hold through it is gold rather than an equity.
Products, Companies & Tools Mentioned
L7 Prime (Dendere's firm; he was on the program for a broader look at the day's market movers)
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