Rate Hike Now Almost Guaranteed In March?
The SA Reserve Bank will meet on the 24th of March 2022 to discuss whether to continue their trend of increasing interest rates (the Repo Rate) or not.
Economists and the SARB themselves have warned that it is incredibly likely that we will see a hike in reaction to the effects of the War in Ukraine and its big impact on oil and wheat prices (and thus a spin-off to all food costs and pushing up inflation).
Oil has been trading at very high rates as the world reacts to markets being closed or reducing dependence on Russian oil. Oil usage was down for the majority of the pandemic and started to creep back up as markets opened up and restrictions were reduced. Then, with the war in Ukraine, the price shot up well over $100/barrel almost overnight amid supply and demand fears.
And Another One After That?
It is also likely that the planned further hike which was expected to follow in May could end up kicking in earlier and could be announced in April instead. Overall the SARB have indicated they intend to bump the rate by 125 basis points over the next 21 months. The previous plans however were made with less global disruption in mind and counting on slowly lowering inflation figures. There is concern that this could force the rate higher sooner or may blow those projections out of the water.
Get Help If Things Are Too Tough
As a consumer, this means that if you are paying off your credit it is likely to now cost you more to do so or take you much longer to do so as you end up paying more and more towards the interest portion of your debts each month. The credit providers certainly will be quick to ask you to pay more monthly.
‘if you are paying off your credit it is likely to now cost you more’
If you are struggling to cope with the rising price of goods and services and still pay off your credit then consider talking to an NCR registered Debt Counsellor (ask to see their certificate) for some sound advice on how to make ends meet. They can look over your whole situation objectively and with years of experience and offer you sound advice. For those who are in debt review, it is also a good idea to speak to your Debt Counsellor for similar advice if you feel that you are struggling to make your planned debt repayments.
Be sure to check out the service directory listing in each issue of Debtfree Magazine each month for details of a Debt Counsellor near you.
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