Guiding consumers since 2009

Rating hike cycle may resume

By Danielle van Wyk

According to last week’s announcement from South African Reserve Bank (SARB) governor, Lesetja Kganyago, the rate hike cycle could resume despite the current bleak economic outlook.

The bold statement comes after the last two meetings of the monetary policy committee (MPC) where interest rates were kept on hold.

It was further reported that South Africa is in danger of entering into its first recession, after contracting 1.2 % in the first quarter. This due to several factors including the severe drought,decreasing commodity prices, threats of a further downgrade to junk status and the weak Rand, which had reduced by 20% against the US dollar. .

Despite the MPC conveying their preparedness to deal with inflation pressures should the cycle resume, they are also mindful of the weak state of the current economy.

The average growth at the moment for this year has been zero and this in itself is accompanied by additional pressures and economic strain.

Having just come out of a series of tough ratings reviews, of which came out of fairly unscathed, all eyes are on the next bout of reviews scheduled for December.

“Reserve Bank governor Lesetja Kganyago said SA faced the typical monetary policy dilemma of slow growth with rising inflation. He said monetary policy would be sensitive to the fragile state of the economy, but the MPC was concerned that failure to act against heightened inflation pressures and risks will cause inflation expectations to become entrenched at higher levels", reported BD Live.

Handy Tip: Feeling the financial pressure? Why not invest in professional advice in the form of debt counselling. Simply click here to apply.

Recent Articles

Featured Are you entitled to your spouse’s pension after divorce?

Divorce means more than just parting ways with your partner. It may also involve parting ways with your assets. The Divorce Act states that your retirement fund forms part of your assets. This means that it will be considered when dividing up your assets.

Retrenched – what payments are you entitled to?

In the current struggling economic climate, retrenchments are a regular occurrence and not everyone survives the cut. If you find yourself on the receiving end of retrenchment you may have questions about the payments that are due to you.

Do you want to settle your debt?

You may be considering settling your credit account, whether it’s a credit card or various store accounts, now may be as good a time as any. This especially if you have saved, or you received a tax return or salary bonus. 

Can you afford a personal loan?

Taking out new debt is not always a choice. However, if you’re not pressed by a medical emergency or an unforeseen disaster, it’s worthwhile considering whether you can actually afford it. But what does it mean to “be able to afford a personal loan”? What percentage of your income should you not exceed dedicating to it? 

Deals

Builders Black Friday Special

Price: R5000
When: Until 29 November 2019
Where: Online

Café Rousse Monday Special

Price: Available on request
When: Mondays
Where: Nationwide

Skye Bar Mojito Special

Price: R55
When: Until 31 December 2019
Where: Johannesburg