Economist Gianni Rossouw predicts a 50 basis point interest rate hike this month.
The South African Reserve Bank’s monetary policy committee will meet to discuss the country’s final rate hike decision for the year, with an announcement on the move expected next Thursday.
A rise in interest rates can slow inflation, making the cost of borrowing more expensive. The current loan rate is 9.75 percent.
Wits Business School economist Gianni Rossouw says: “Personally, I expect further interest rate hikes at this point and time. My expectation is 50 basis points or half a percent.”
“As inflation expectations remain high, it is necessary for the Reserve Bank to act, so we will see until inflation expectations change. Indeed, consumers, especially those with debt, will feel the impact,” says Rossau.
Unpacking the SARB’s decision to increase the interest rate by 50 basis points:
