South Africa’s headline consumer inflation fell to within the central bank’s target range in April as food price rises slowed, data showed on Wednesday, sending the rand currency to a new 4-week high and boosting hopes for a rate cut later this year.

The annual inflation slowed to 5.3 percent in April from 6.1 percent in March, Statistics Africa data showed, beating market expectations of a 5.55 percent year-on-year print.

On a month-on-month basis, inflation fell to 0.1 percent in April from 0.6 percent previously.

The South African Reserve Bank, which is due to announce its latest interest rates decision on Thursday, targets annual CPI of between 3 percent and 6 percent.

Economists polled by Reuters expect the central bank to keep the repo rate unchanged at 7 percent this month, but a cut later in the year is being priced in.

“Today’s inflation figure supports our view that the Reserve Bank will cut its key policy rate later this year,” Capital Economics Africa economist John Ashbourne wrote in a note.

“Policymakers will, however, probably keep their key rate on hold at their meeting tomorrow. We expect that they will wait until inflation is more securely anchored within the target range before loosening policy.”

Food inflation, which climbed close 12 percent in 2016 as the worst drought in decades swept through southern Africa, continued to retreat, slowing to 6.7 on a yearly basis.

The CPI data pushed the rand to 12.9825 per dollar, a fresh 4-week high. By 0903 GMT, the rand had retreated to 13.0025/dollar, 0.71 percent firmer than its overnight close.

In fixed income, government bonds also firmed with the yield for the benchmark paper due in 2026 dipping 7.5 basis points to 8.485 percent.

(Reporting by Olivia Kumwenda-Mtambo; Editing by James Macharia)