The Inkatha Freedom Party today called on the Reserve Bank Governor, Tito Mboweni, to assist SA's struggling consumers by cutting interest rates at the Reserve Bank's monetary policy committee (MPC) meeting in December. 

Inflationary data released yesterday - showing that the CPIX inflation rate slowed down for the second month running - coupled with the news that economic growth has ground to a decade low of 0,2%, has raised hopes for a rate cut.  

"The continual interest rate and food price hikes have made it much harder for families to put food on the table and keep to a roof over their heads. This has had a detrimental effect on those living in abject poverty, but also on South Africans from all walks of life. The IFP therefore argues that a rate cut should be considered next month," said Hennie Bekker, IFP MP. 

The weak rand will most likely govern Tito Mboweni's policy response at the next MPC meeting. 

"We know that the volatile rand increases South Africa's import bill and adds to inflationary pressures, but we believe that an interest rate cut of 1% is possible. Furthermore, the IFP believes that the time has come for determined policies to assist the poor - low prices for paraffin and other items that feature high in the budgets of poor households should urgently be reviewed.

Such an approach would have the bonus of slowing down targeted inflation and opening-up possibilities for further interest rate cuts," concluded Bekker. 

Contact:
Hennie Bekker
083 255 4520.