Sudden spiral of inflation raises concern in South Africa

CCTV News

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South Africans have been dealt another blow. With an already weak economy, rising food and fuel costs and ongoing power price hikes, they now have to pay more for credit. The Reserve Bank hiked the repo rate for the first time in a year. CCTV’s Sumitra Nydoo¬†filed the report.
Follow Sumitra Nydoo on Twitter @sumitranydoo

Sudden spiral of inflation raised concern in South Africa

Sudden spiral of inflation raised concern in South Africa

South Africans have been dealt another blow. With an already weak economy, rising food and fuel costs and ongoing power price hikes, they now have to pay more for credit. The Reserve Bank hiked the repo rate for the first time in a year. CCTV's Sumitra Nydoo filed the report. Follow Sumitra Nydoo on Twitter @sumitranydoo

Highlight:

  • The economy is growing at just over 1% and inflation is ticking up. Consumer confidence is at its lowest levels in 14 years. The latest interest rate hike could see a further slump.
  • The Reserve Bank is concerned inflation is ticking up and will soon reach the upper end of the target band of 3 to 6%. An interest rate hike in the US later this year is adding to fears.
  • Despite valid arguments around inflation, the timing of the rate hike couldn’t be worse. Unemployment has ticked up to 26.4% and job losses are mounting, especially in the mining sector as a result of increased costs and falling commodity prices.

 

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