Goldman Sachs is making a contrarian case for a steep slowdown in South Africa inflation next year, setting itself apart from other observers and the country’s central bank.

“We think inflation will average 3.3% next year, and then will pick up and stabilise at about 4%,” Andrew Matheny, an economist at the investment bank, said in an interview at Bloomberg’s Johannesburg offices. That compares with the 4.2% median estimate of 30 economists surveyed by Bloomberg and 4% forecast by the central bank.

“We think there’s a large negative output gap that has been and will continue to be disinflationary,” said Matheny. “So, our inflation forecasts for next year, but also in the medium term, are way below everybody else’s.”

Goldman’s upbeat outlook on price pressures, which undershoots the midpoint of the central bank’s 3% to 6% target range, where it prefers to anchor inflation expectations, also means that it’s more optimistic on interest rates.

Matheny foresees an additional 125 basis points in rate cuts in the current easing cycle that started in September. The median of 17 economists in a Bloomberg survey sees a further 75 basis points of easing and the central bank’s staff model suggests another 50 basis points of cuts.

The central bank’s monetary policy committee delivered its second quarter-point rate cut of the easing cycle last week, lowering the benchmark rate to 7.75%.

Governor Lesetja Kganyago said that while inflation slowed to 2.8% in October, the MPC was taking a cautious approach because the environment is uncertain.

The rand has slumped 4% against the dollar since Donald Trump won the US presidency on bets that his promises on tariffs and taxes will boost the greenback. Goldman sees the rand sell off as overdone because South Africa won’t be directly affected by the threatened levies.