Low interest rates and high inflation do not encourage economic growth, economist Chris Hart said on Tuesday. "Low interest rates in the developed world have become counter-productive.... Growth has to be funded. In South Africa where interest rates are at 5.5%, we cannot get growth going," said Hart adding that inflation was too high to stimulate growth. "Savings is a critical part of driving economic growth," he said. In September the Consumer Price Index (CPI) rose to 5.7%. Hart said … [Read more...] about Low Interest Rates Stifling Economic Growth
inflation
CPI rises to 5% in June
The Consumer Price Index (CPI) rose to 5% in June in line with market expectation, Statistics South Africa said on Wednesday. "Consumer prices rose by 0.4% month-on-month and 5.0% year-on-year in June after increasing by 0.5% month-on-month and 4.6% year-on-year in May. This was in line with the market consensus but slightly higher than our forecast of 4.8% year-on-year," Nedbank economists said. According to Stats SA, the food and non-alcoholic beverages index increased by 0.5% between … [Read more...] about CPI rises to 5% in June
And the Focus Turns to Inflation
The Reserve Bank has vowed to keep a watchful eye on second-round effects of inflation, it stated in its May Monetary Policy Review. "The MPC will remain vigilant with respect to indications of second-round effects or generalised inflation, and will not hesitate to take timeous appropriate action, particularly if inflation is expected to move out of the target range on a sustained basis," said the central bank on Tuesday. The bank would continue to give primacy to its objective of price … [Read more...] about And the Focus Turns to Inflation
January PPI Down 0.3 Percent
The Producer Price Index (PPI) eased to 5.5 percent in January, Statistics South Africa (Stats SA) said on Thursday. Producer inflation eased to 5.5 percent from 5.8 percent in December, a figure which Nedbank economists said was slightly above market expectations. In January, prices rose sharply, increasing by 1.1 percent, due to higher commodity prices, with the mining and quarrying category rising by 3.3 percent month on month. The bank said there was risk of further commodity price … [Read more...] about January PPI Down 0.3 Percent
CPI Marginally Down in December
The Consumer Price Inflation in December fell marginally to 3.5 percent, Statistics South Africa (Stats SA) said on Wednesday. December 2010 CPI was 0.1 percent lower than November's 3.6 percent. In December, prices rose by 0.2 percent, mainly due to higher fuel prices and rent costs. Although December's figure came close to market expectation, Nedbank economist Carmen Altenkirch said the favourable figure is not likely to sway the Reserve Bank in favour of cutting interest rates when it … [Read more...] about CPI Marginally Down in December
