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Rates horror continues

Dec 06 2007 15:16

Cape Town - 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.

- Fin24

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American Man
Apr 29 2008 12:47 Report this comment

Why don't you all admit it that when you have a negro in charge of your economy it is a negro economy. White people lived quite well when white countries were run by white people. Now that most of the white countries governments are just puppets for their jewish masters things are getting worse and worse every year both economically and sociologically. White men need to grow back their balls and start defending their territory, their women and children. What you got to loose except for negroes and jews?

Grant
Dec 07 2007 10:03 Report this comment

Good comments The Guide, Excellent article (http://www.fin24.co.za/articles/default/display_article.aspx?ArticleId=1518-1783_2234212). Unfortunately in African politics there is a hardheaded stuborness. Financially, Europe and the Americans are the world leaders (just look at the strength of their currencies) but the Africans think they know better and will destroy and economy to try to prove themselves right, point of example take a look at our neighbor Bob and what he has done.

The Guide
Dec 07 2007 07:49 Report this comment

Tito, Trevor and friends.....this is the way to DROP inflation, learn from the PROFESSIONALS!! Read and learn, and fix what you have broken....copy and paste this link into your browser.... http://www.fin24.co.za/articles/default/display_article.aspx?ArticleId=1518-1783_2234212

gplover
Dec 07 2007 07:34 Report this comment

They should penalise short term dent not a house which is more expensive and long term.

gplover
Dec 07 2007 07:31 Report this comment

Its funny that England also have higher inflation but they DROPPED the interest rate!! If you already were your limit when rate was at 10% of course you would need to get money elsewhere to buy food and petrol. Whose salary wnet up with the same amount as your bond or everything else. Tito cant do maths

Fred
Dec 06 2007 19:17 Report this comment

I have lived abroad for quite a long time, but I return annually to visit my folks. Everytime I return I am just shocked at how beyond their means South Africans live. The moment you step out of OR Tambo Airport, all you see are BMW's and Mercs, and it's just downhill from there. SA's need to learn to live within their means. It's as simple as that. I applaud Tito. He and the ECB are the only central bankers left with any semblance of cajoles.

Gerhard
Dec 06 2007 17:24 Report this comment

Kwae and Spencer. Lets understand the fundamentals of wealth creation. I earned R100 a month back in 1972 when I started working. I did not stay at home (came from a broken family) and had to take care of myself. R100 was little, even in 1972. I still saved a minimum of 25% of my monthly salary every month, and has done so since then. Obviously I earn much more now, but you will be surprised what compound interest can do to even R25 (1972 prices). Yes, you do need a job, that is essential, but for those who has jobs I dont buy their poverty line, not at all. It is self induced.

Spencer
Dec 06 2007 17:13 Report this comment

I am now finding it very difficult to sell my house not to mention making a loss. I have already lost R35000 on what I paid for it. How on earth did this happen? I now have to drop the price even more cause nobody can afford it! Whats this world comming to?


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