Repo rate hike ‘a positive development’ - economist
An economist says while an upward adjustment of the repo rate might be difficult news to digest, it could work in our favour in the long run.
The SA Reserve Bank on Thursday announced the repo rate would be hiked to 3.75%.
The prime lending rate will inch up to 7.25%.
“By increasing the rate sooner, fewer interest rates will be required. I think the Reserve Bank did the right thing.
“What's likely to happen now, is that it will have a negative impact on for example, the consumption expenditure and the economy, generally speaking, but the positive of this is that inflation expectations will be addressed and that in the long term is good for the economy.”
