Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
The Reserve Bank’s decision to hike the repo rate is not “anti-poor” (“Reserve Bank’s lighter touch signals interest rates are near peak”, January 26). On the contrary, it is a calculated measure to decrease the high inflation rate in the medium and long-term.
Raising the cost of borrowing money discourages people from taking out loans and thereby leaves less disposable income for them to use. This ultimately curbs the demand for goods and services and averts demand-pull inflation, which is typically caused by a rise in disposable income.
There is nothing exceptional about what has been said here — these are the basics of economics. That so many people are unaware of them should be a cause for concern.
Perhaps we should consider making economics a compulsory subject in the school curriculum so such confusion can be avoided.
Ayanda Sakhile Zulu Via email
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
LETTER: Rate hike not ‘anti-poor’
The Reserve Bank’s decision to hike the repo rate is not “anti-poor” (“Reserve Bank’s lighter touch signals interest rates are near peak”, January 26). On the contrary, it is a calculated measure to decrease the high inflation rate in the medium and long-term.
Raising the cost of borrowing money discourages people from taking out loans and thereby leaves less disposable income for them to use. This ultimately curbs the demand for goods and services and averts demand-pull inflation, which is typically caused by a rise in disposable income.
There is nothing exceptional about what has been said here — these are the basics of economics. That so many people are unaware of them should be a cause for concern.
Perhaps we should consider making economics a compulsory subject in the school curriculum so such confusion can be avoided.
Ayanda Sakhile Zulu
Via email
JOIN THE DISCUSSION: Send us an email with your comments to letters@businesslive.co.za. Letters of more than 300 words will be edited for length. Anonymous correspondence will not be published. Writers should include a daytime telephone number.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Most Read
Related Articles
ARTHUR KAMP: Time for the MPC to take the foot off the accelerator
CARTOON: Reality check for Ramaphosa
ARTHUR KAMP: A question for the Reserve Bank’s MPC: are we there yet?
Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January.