Fin24 reports Interest rates are back at pre-pandemic levels after the SA Reserve Bank (SARB) hiked rates on Thursday by 75 basis points, for a second meeting in a row.

The move brings the repo rate to 6.25%, and the prime rate to 9.75%. On a new home loan of R2 million, this hikes the monthly instalment by more than R970. Since November last year, monthly payments on a R2 million home loan are almost R3,400 more expensive due to a raft of rate hikes. The latest rate hike was in line with economists’ expectations, and brings interest rates back to a level last seen in January 2020, before the Reserve Bank made steep cuts to bolster an economy in lockdown. On Thursday, SARB governor Lesetja Kganyago, said risks to the inflation outlook were assessed to the upside, with electricity and other administered prices continuing to present clear medium-term risks. "What is detrimental to the economy at the moment is the rising cost of living, which is depicted through inflation and that failure to deal with inflation now would be detrimental to the economy down the line. And that is what our focus is," Kganyago indicated. Economists expect another rate hike in November – even though inflation may have peaked. In August, consumer inflation cooled slightly, to 7.6% from 7.8% in July, thanks mostly to lower fuel prices. Some economists forecast another hike in January 2023 and expect that the repo rate will peak at 7.00%.

• Read the full original of the report in the above regard at Fin24
• Lees ook, Repokoers: Nóg ʼn groot verhoging, by Maroela Media

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