Fin24

SA should adjust policy stance - Marcus

2012-10-02 18:07

Johannesburg – South African policy makers should “adjust the policy stance” and develop policies and regulations that will help SA better absorb the shocks of the global economic slowdown‚ Reserve Bank governor Gill Marcus told a business function on Tuesday.

Marcus said the spillovers of the global economic slowdown on SA were “profound” and needed to be addressed in order to improve confidence levels in the country.

The monetary policy committee's decision to keep interest rates unchanged at current levels last month “was not an easy one” given the deteriorating global economic outlook‚ said Marcus.

She noted that the domestic economic outlook was “beset” by its own challenges‚ some of which were caused by both the global and local economic slowdown.

The bank forecasts 2012 growth at 2.6%‚ rising to 3.4% next year “as the global economy starts to recover”, Marcus said.

Marcus‚ however‚ told the function that even these forecasts‚ which the bank recently revised downwards‚ were still “optimistic”.

Household spending continued to be the main driver of domestic growth‚ Marcus said‚ adding that private sector gross fixed capital formation remained weak.

Speaking on jobs‚ the governor said that while job creation had picked up‚ it had remained “sluggish”.

Analysts have cautioned that the current strikes in some sectors of the economy as well as steep wage increases could lead to job losses and constrain new job creation by companies.

Marcus reiterated the bank's concern over rising food and fuel prices‚ which she referred to as the main upside risks to the inflation outlook.

Inflation is expected to have bottomed out at 4.9% year on year in July.

Comments
  • gieljam.gomtor - 2012-10-02 18:20

    Where has she got her info?I hope they don't pay her too much to tell us something we know and have been telling them through our comments on news 24

      pieriewaaier.zooms - 2012-10-02 18:33

      Gieljam but the mere fact that she Governor of SARB says it carries a lot of official weight. Of course she knows it but more so, she has vast research capabilities at her disposal so she knows what she's talking about and confirming what we have been saying all along, is now official and good for her.

  • braamc - 2012-10-02 18:29

    Get the thieving criminals in government stealing less and invest in the people. The hell with so called global recessions, the problem lies in SA

  • gordon.thefreeman1 - 2012-10-13 07:53

    Inflation at 4.9 percent? BULL!! Fuel and food prices went up by only 4.9 percent? BULL!! As long as this lie is spread and nothing done about the high cost of living, strikes will continue. How much do you need to earn to buy property, a car and food every month? R20 000 is not even enough.

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