PROPERTY NEWS - The third Monetary Policy Committee meeting takes place this month, where the Reserve Bank will decide whether the prime lending rate will be hiked or remain at 10.50%.
Given the fact that inflation is on the rise and has once again breached the top end of the target band, and the continued weakening of the currency, the Reserve Bank will be under pressure to raise the interest rates despite the low economic growth.
Tough pill to swallow
Regional director and CEO of RE/MAX of Southern Africa, Adrian Goslett, says that with inflation expected to reach around 8% towards the end of the year, the Reserve Bank will be hard pressed not to push rates up, even though previous hikes have not done anything to curb inflation.
Tough pill to swallow
Regional director and CEO of RE/MAX of Southern Africa, Adrian Goslett, says that with inflation expected to reach around 8% towards the end of the year, the Reserve Bank will be hard pressed not to push rates up, even though previous hikes have not done anything to curb inflation.
He notes that another rate increase at this point amid petrol price hikes, rising food prices and electricity tariff increases, would only heap burning coals onto consumers heads.
“With the compounding effect of the ever increasing cost of living, even a marginal increase in rates could be the proverbial ‘straw that broke the camel’s back’ for numerous consumers.
Many households are already struggling to make ends meet, so further hikes will be a tough pill to swallow,” says Goslett.
