Tag: interest rate

There is so much uncertainty in the world today – from the two-year-long fight against the pandemic and consumers’ battle against war-induced fuel hikes, to investors trying to interpret global recession concerns or South Africans’ struggle with Eskom.

Equity markets have been under considerable selling pressure in 2022, as investors anticipate that stubbornly high inflation will cause central banks to raise short-term interest rates multiple times this year. At the same time, expectations for global economic growth have been revised downwards, following further disruptions to global supply chains on the back of Russia’s invasion of Ukraine and China’s strict COVID-19 lockdown measures.

A record sell-off coupled with a shifting economic backdrop mean opportunities in global fixed income markets have appeared. It has been an extraordinary time for bond markets. As an asset class, fixed income is often seen as equities’ boring cousin, particularly over the past decade of low yields. Recent months, however, have been anything but boring, albeit for the wrong reasons.

South African businesses that have already planned their pay increases for 2022 have some tough decisions ahead of them. This is due to rocketing inflation, fuelled by global economic turbulence and local conditions, which is only expected to worsen over the rest of the year.

This year, Black Friday will fall on 26 November. As has been the trend for the last few years, many retailers have already started offering discounts on goods since the beginning of the month. Last year (2020), many South Africans took to social media to lament their dissatisfaction with what many termed 'Black Friday scams'.

Lebanon is facing a financial meltdown so severe that the World Bank has branded it as one of the worst since the mid-19th century. The country is fast spiralling into a dangerous situation of state failure, marked by violent riots, escalating blackouts and spiking fuel price increases.

Saving even the smallest amount regularly will make a difference to your long-term financial independence. Well-planned investing and taking advantage of the ‘magic’ of compound interest are two of the most powerful ways in which South Africans can elevate themselves financially, and secure their financial independence one day.

While South Africans continue to grapple with the economic pressure of ongoing lockdown restrictions combined with the aftermath of looting and riots, residents of Durban, Cape Town and Johannesburg are also feeling the impact of municipal rate hikes.

The beginning of 2021 was all about 'reflation' – a belief that massive fiscal stimulus, historically low interest rates and the reopening of economies on the back of COVID-19 vaccinations will drive an economic boom placing upward pressure on inflation.

All five members of the Monetary Policy Committee (MPC) decided to keep the repo rate unchanged at 3,5%. It has been on this level since 23 July 2020. The MPC viewed the overall risks to the Consumer Price Index (CPI) outlook to be on the upside compared to balanced in the March 2021 statement. This means the MPC’s interest rate outlook is more hawkish.