INTEREST RATES

On Thursday, the Monetary Policy Committee of the South African Reserve Bank (SARB) decided to increase the repo rate, the rate at which the SARB lends to banks, from 5.5% to 6.25%, an increase of 75 basis points. This translates into an increase in the banks’ prime lending rate from 9% to 9.75%. It comes while inflation remains high: Statssa announced this week that annual consumer price inflation was 7.6% in August. Homeowners will have to adjust to higher home loan repayments, says Adrian Goslett, regional director and CEO of Re/max of Southern Africa. He says the impact of these interest rate hikes might only be felt next year, especially if they continue to climb.