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Financial News

Higher than targeted inflation figures have motivated the SARB Monetary Policy Committee to increase the Repo Rate by 25 Basis Points.

REPO RATE NOW: 7%

PRIME RATE NOW: 10.50%

This means that banks will be charged more when borrowing from the SARB, and they in turn will charge more for the credit they have already extended to their clients.

This means that all credit users (without fixed rates) will now begin paying more for their debts.

We all knew it was coming, but it still is disappointing. International conflicts between world powers continue to drive energy and food costs higher. While increasing the rates now will have no direct impact on the external cost of oil or the value of the Rand compared to the US Dollar, it will in the short term drive consumer spending down, and hold people back from using funds elsewhere to drive the economy.

Long term however it is hoped that this (the first of more increases to come) will have a positive effect.