KHAYA SITHOLE: The ANC’s misguided Reserve Bank obsession
The ruling party should target government-controlled prices that feed inflation instead of scrutinising the Bank’s necessary measures
Last week, South Africans received a much-needed break from the interest-rate hikes that have been implemented by the Reserve Bank since 2021. The hiking cycle — which took the repo rate from 3.5% in November 2021 to 8.25% — had resulted in an income squeeze for citizens that came at the same time as the prolonged cost-of-living crisis. The connection between the two — where the cost-of-living crisis pushed inflation beyond the Bank’s tolerance level of 3%-6% and forced it to react to counter inflation — has created new murmurs about the Bank’s role in squeezing already-suffering citizens.
Fikile Mbalula — the secretary-general of the ANC — uttered that the party had directed finance minister Enoch Godongwana to engage with the Bank and urgently hold discussions to explore other measures to manage the current economic challenges other than raising interest rates...
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