As Reserve Bank eyes inflation, jobs suffer

The South African Reserve Bank has hiked interest rates for the first time in three years, sparking criticism that the move will throw cold water on the country’s already glacial economic growth.

The 25 basis point hike — announced last week amid mounting inflation risks — comes ahead of another important event on the domestic calendar: the release of the country’s jobs data, which for each quarter since the advent of the Covid-19 pandemic has indicated record levels of unemployment.

Critics of the Reserve Bank’s inflation-targeting mandate have pointed out that the interest rate hike may only add to the country’s unemployment woes. Others argue that keeping interest rates at a record low would jeopardise price stability, hurting the poor.

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Sarah Smit
Sarah Smit
Sarah Smit is a general news reporter at the Mail & Guardian. She covers topics relating to labour, corruption and the law.

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