Rate hikes still a concern for the IFP

MEDIA STATEMENT ISSUED BY:
HENNIE BEKKER MP
IFP SPOKESPERSON ON FINANCE

October 13, 2006

Hennie Bekker, the IFP spokesperson on Finance, today said:

"We note that the Governor of the Reserve Bank, Mr Tito Mboweni, yesterday took the interest of the consumer into consideration and only raised the repo rate by 50 basis points, and not a full percent as predicted on Wednesday."

"Although the IFP is not in favour of interest rate hikes to curb consumer spending, we welcome the caution used by the Governor in raising the repo rate. The IFP would still like to call for the Governor and the Reserve Bank's monetary policy committee to investigate alternatives in curtailing consumer spending."

Bekker concluded by reiterating the IFP's stance on alternatives to interest rate hikes. He said: "We, the IFP, have long believed that the raising of interest rates is not the only solution to curbing irresponsible consumer spending and would be grateful if consideration of these alternatives could be given by the Reserve Bank Governor, especially when you consider the prediction of four more repo rate increases. Examples of these alternatives are mandatory deposits for vehicle finance and curbing credit card expenditure by curtailing 3 to 6 month paybacks."


FOR FURTHER INFORMATION CONTACT:
Mr Hennie Bekker MP: 083 255 4520
Noleen Hendricks: 082 886 9848