Interest rates hit 14.5%

By Staff Writer

From Fin24, 6 December 2007

Reserve Bank governor Tito Mboweni took the spirit out of Christmas shopping for many borrowers when he raised interest rates by another 50 basis points, in line with expectations.

This takes the repo rate, the rate at which the Reserve Bank lends money to commercial banks, to 11% and the prime lending rate to 14.5%.

The bank has now hiked interest rates by 400 basis points since tightening began in June last year.

Analyst polled by I-Net Brdige and Reuters all expected a 50 basis point increase on the latest economic indicators, notably the bank's inflation target, CPIX's, surge to 7.3% in October.

Mboweni warned repeatedly in the run-up to Thursday's announcement that consumers need to tighten their belts.

In a precursor to the decision, Mboweni barred photographers from the bank's news conference and changed the format of its rates presentation.

Usually, Mboweni reads a prepared statement before delivering the Monetary Policy Committee's verdict on rates. On Thursday, the repo rate verdict was announced first.

Tell us what you think about the latest rate increase by voting in the Justmoney.co.za poll on the home page.

Check out Justmoney.co.za's Five Festive Fixes for ways of reducing the impact on your pocket during the holiday season.

Recent Articles

Featured Should you authorize a minor on your credit card?

If you have children who need to move around independently, it may be practical to authorize them as users on your credit card. However, is this the right thing to do?

Economic devastation sees rapid rise in debt counselling

A survey conducted by DebtBusters indicates that consumers are increasingly turning to debt counselling.

How to reduce your risk of identity theft

Imagine your friend is a victim of identity fraud. We have a look at what this entails, and we find out what you can do to avoid getting into this situation yourself.

Deals

Wednesday Burger Nights at The Vineyard

Price: R190
When: Wednesdays
Where: Cape Town

Sanctuary Touch Monthly Special at Sanctuary Spa

Price: R490
When: Mondays to Sundays
Where: Cape Town

Blowdry Packages at Oayssis Hair and Beauty Bar

Price: R850 to R1800
When: Anytime
Where: Cape Town


Latest Guide

Guide to debt rehabilitation solutions