The Reserve Bank’s decision to keep the repo rate unchanged at 8.25% received mixed reaction from political parties. Some welcomed the decision, while others poured cold water on it, criticising government’s fiscal policy of inflation targeting.
This is the first time the rate remained unchanged since November 2021 and after 10 consecutive hikes.
Some of these parties argue that it’s time for the government to respond appropriately with effective economic policies as hard pressed South Africans are battling to survive.
Interest Rates | Reserve Bank to announce its decision on the Repo Rate:
Reactions from political parties
Democratic Alliance (DA) MP Dr Dion George says, ” This cold comfort for South African consumers who are battling across the living crisis and this is government induced and a direct result of inability to implement effective Fiscal policy.”
Freedom Front Plus (FFPlus) MP Wouter Wessels says, “The Fiscal policies of government fails to get the GDP to grow and to keep inflation down. That is why the only mechanism left is monetary and the Reserve Bank tries its utmost to get the inflation rate under control and get GDP going and that is the increase we’ve seen in the repo rate. We do welcome the fact that those decisions have bared fruit.”
United Democratic Movement (UDM) Chief Whip Nqabayomzi Kwankwa says, “UDM has been a vociferous citric of the ANC government’s inflation targeting policy, inflation targeting works to a large extent as a policy when inflation is caused by too much money chasing too few goods which is a demand issue, in instances such as this one where inflation is caused by supply side disruptions mainly the Ukraine and Russian war inflation targeting doesn’t work as a policy.”
Good Party Chief Whip Brett Herron says, “We hope that the decision that was made today is a turning point for this pattern of increasing the interest rate and that the interest rates will start to decline so that we can have more liquidity in our markets and so that South Africans can experience a relief from this tremendous financial pressure”
National Freedom Party (NFP) MP Ahmed Munzoor Shaik Emam adds, “However the NFP is disappointed at the attitude of the minister of finance and the question that arises is that, does the minister of finance serve the interest of ordinary South Africans. The citizens have been under immense pressure given the high interest rates and many of them have been losing their home, vehicles, as a result of the increase in interest rates.”
Political parties react to the unchanged repo rate: