I was going to bet on a rate hold – then inflation hit 5%

Nicola Mawson somehow had R5 left before payday - here are her views on inflation, interest rates, and some life hacks.

Yesterday morning, when asked which way I thought the South African Reserve Bank (SARB) would go with interest rates, I was leaning firmly towards hold. In fact, I was happy to bet the R5 I could afford on them taking a 'wait and see' stance.

(Don't judge me, there's always too much month left at the end of the money and South Africans are all really battling. I'm chuffed I can even afford to bet R5.)

At 10am, that view changed. Inflation accelerated to 5% in June, above market expectations of between 4.7% and 4.8% and the highest level since June 2024 when the print came in at 5.1%. For me, this shifts the needle towards a 0.25 percentage point hike, which would take the prime lending rate to 10.75%.

Most South Africans, however, are less concerned about interest rates than they are about the cost of living, a view that translates into "debt can wait, we need to eat first". Recent figures from DebtBusters bear this out — because consumers' main source of anxiety is the cost of living.