Interest rate

SA Reserve Bank Governor Lesetja Kganyago announced the increase, taking the repo rate to 4.75% and the prime rate to 8.25%.

But he said that the impact on South Africa's residential housing market was not expected to be significant, especially as this was still the lowest prime interest rate in more than two decades. Seef said that the reserve bank was now in a hiking cycle as it looked to normalise the rate and there were still increases of 100 basis points expected this year. Governor Lesetja Kganyago announced the increase, taking the repo rate to 4.75% and the prime rate to 8.25%. SA Reserve Bank Governor Lesetja Kganyago announced the increase, taking the repo rate to 4.75% and the prime rate to 8.25%. He cited high electricity and fuel prices as the main drivers of inflation, saying that there was agreement in the monetary policy committee that the rate needed to be hiked. "As inflation has remained high and stick, so have the central banks become more and more hawkish, therefore the bank is also more likely to increase its rate by 50 basis points at its next meetings," Madisha said.

While the decision by the SARB to hike the repo rate by 50 basis points to 4.75% will make home loan finance a little more expensive, the rate remains well…

Clarke said that there could also be an increase in urgent and/or distressed property sales as people who previously bought at the limit of their affordability feel the pinch of higher interest rates. Sellers will need to take this into account when positioning their properties, leaning on the skills of property professionals to compete effectively.” At the same time, house price growth has slowed to around 4% on average – slightly higher in the lower price bands. Mortgage originator, Ooba also reports that 60% of its approved mortgage bonds in the first quarter were above the R1.5 million price level. “Beyond the further 100bps, we do not anticipate any further impact on the interest rate,” Seeff said. “We should now be aware that we are in a hiking cycle as the SARB looks to normalise the rate – and there is a further 100bps in hikes expected this year.

Borrowers are likely to sink further into debt with the announcement of a 50 basis points interest rate hike by Reserve Bank governor, Lesetja Kganyago ...

Higher than expected inflation has pushed major central banks to accelerate the normalisation of global policy rates, tightening global financial conditions. In the most recent case of higher wage demands, the National Union of Metalworkers of SA and the National Union of Mineworkers are asking for a one-year, 15% across-the-board wage hike and a housing allowance of R1,600 for Eskom workers. “The SARB is faced with and will continue to face the difficult dilemma of having to raise interest rates to combat soaring inflation – in line with the rest of the world,” she says, adding that unlike the US and the EU, South Africa is not starting from a low base, but faces an economy that is already taking strain with consumers struggling to meet financial demands. “I see another 50bps of rate increases for the rest of the year, with a rising probability that the Monetary Policy Committee will not hike rates at every meeting for the rest of 2022, but we will most probably see rates going up by another 50bps next year,” he says. Johann Els, chief economist at Old Mutual Investment Group, says the increase is part of the SARB’s effort to front-load rate increases with only one meeting in the second quarter of this year and the next meeting towards the end of July. Growth in output in the first quarter of this year is expected to be 3.6%. However, the trend of rising global producer prices and food price inflation in recent months is expected to continue on the back of the Russia-Ukraine war, which is likely to persist for the rest of 2022.

Stocks and US equity futures pushed higher Friday as sentiment received a boost from a move by Chinese banks to lower a key interest rate for long-term ...

Economic data this week highlighted the stark impact of Covid-19 restrictions and lockdowns in many major Chinese cities. That compared with a 7.5% drop in March. China's central bank today announced it would cut a key interest rate as the country fights to boost its virus-hit economy and Covid-19 restrictions rip across major cities. Asian stocks and US equity futures pushed higher today as sentiment received a boost from a move by Chinese banks to lower a key interest rate for long-term loans by a record amount. Stocks and US equity futures pushed higher Friday as sentiment received a boost from a move by Chinese banks to lower a key interest rate for long-term loans by a record amount. Sunac, one of China's largest developers to default on payments in recent months, said last week that sales in major cities had fallen dramatically in March and April due to the coronavirus wave.

Governor Lesetja Kganyago says the risk of stagflation in developed countries should serve as a lesson for those objecting to the bank's fight against ...

The JSE All-Share Index was up 0.8% as global markets took heart from China's decision to lower a key benchmark rate, injecting optimism among traders that ...

Fuelling worries are sky-high inflation across the world. "What would typically be met with a shoulder shrug, incrementally weaker data can now amplify downside move. And with few positive developments of late, the market remains vulnerable to the prevailing narrative, with the negative feedback loop only growing louder in recent sessions."