Governor of the South African Reserve Bank, Lesetja Kganyago, said interest rates are expected to remain higher for longer as the war in the Middle East continues.
South Africans will now be paying more on repaying their home loans, car finance deals, and credit cards after the Monetary Policy Committee decided in increase interest rates by 25 basis points to 10.50%.
This could add as much as R400 a month to living costs for households carrying roughly R1.55 million in debt.
Given the current geopolitical climate and the resultant spike in oil prices to as high as $120 a barrel, the decision will come as no surprise to market watchers.
South African Reserve Bank Governor, Lesetja Kganyago, in announcing the hike, said that the environment had changed since March, when the last meeting was held. He also pointed to households being "squeezed".
