The Independent Municipal and Allied Trade Union (IMATU) welcomes the decision of the Governor of the South African Reserve Bank (SARB), Lesetja Kganyago, to reduce the current repo rate from 6.75% to 6.5%.
“While we welcome the Monetary Policy Committee’s decision to reduce interest rates, this decision will not in and of itself stimulate growth or produce more jobs. Like all South Africans, our members are really feeling the financial pinch of increasing living costs and decreasing disposable income,” explained IMATU General Secretary, Johan Koen.
High unemployment, low economic growth and overstretched consumers necessitate the need to provide financial relief where possible. “As we have indicated previously, IMATU remains concerned about our country’s poor domestic growth forecasts and escalating unemployment figures. Many of our members and South African consumers are cash-strapped, financially burdened and indebted. This decision to decrease interest rates today will not risk a breach of the inflation target range, to the contrary, lower interest rates will result in increased disposable income, promoting growth through enhanced household spending capacity,” concluded IMATU General Secretary, Johan Koen.