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South African central Bank raised the rates.

 


South Africa has down­graded its eco­nomic pro­jec­tions fol­low­ing the worst spell of rolling black­outs in the his­tory of the con­tin­ent’s most indus­tri­al­ised nation.

South Africa

The South African Reserve Bank raised its bench­mark rate by a quarter of a per­cent­age point to 7.25 per cent, a smal­ler increase than in pre­vi­ous policy decisions and below the half-point level that most eco­nom­ists expec­ted, warn­ing that the coun­try’s eco­nomy would barely grow this year.

In Novem­ber it had fore­cast a 1.1 per cent expan­sion.

‘The shift in focus towards growth comes at a time that infla­tion pres­sures are start­ing to dis­sip­ate.’

Eskom, the power pool, is to impose 250 days of rolling black­outs this year, up from a pre­vi­ous fore­cast of 100 days.

The power cuts will remove «as much as two per­cent­age points from growth in 2023, com­pared to the pre­vi­ous estim­ate of 0.6 per­cent­age points», it said.

The cent­ral bank also slashed growth fore­casts for 2024 from 1.4 per cent to 0.7 per cent, when it expects about 150 days of power cuts.

Eskom gen­er­ates nearly all of South Africa’s elec­tri­city sup­ply.

Break­downs at age­ing coal power sta­tions, cor­rup­tion and a lack of funds for main­ten­ance have all added to pres­sure on Pres­id­ent Cyril Ram­a­phosa’s gov­ern­ment.

The shift to a slower pace of tight­en­ing comes as the cent­ral bank con­tin­ues to battle above-tar­get infla­tion.

South African infla­tion remains above the mid­point of a tar­get range of 3 to 6 per cent, but the pace of price rises has faded in recent months. The bank said that infla­tion, which ended 2022 at 7.2 per cent, should fall to 5.4 per cent this year.

www.sba.tax

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Comments

  1. Amalia27 January 2023 at 10:33

    250 days of rolling blackouts!? What is going on in South Africa?

    ReplyDelete
    Replies
    1. Susan27 January 2023 at 11:43

      Corruption. That's what's going on in SA. This country could be doing so much better if it had a few dozen good men and not the corrupt politicians it does now.

      Delete
    2. Dominic27 January 2023 at 14:24

      And regular people have to suffer because of this widespread corruption. And it's only going to get worse.

      Delete

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