South Africa is in its first technical recession in nine years.
Stats SA announced on Tuesday that the country’s real gross domestic product contracted by 0.7% in the second quarter of 2018.
This follows a revised fall of 2.6% in the first quarter of the year.
CEO of Debt Rescue Neil Roets told Radio Islam that the situation is not looking good for consumers at the moment.
“I think the situation will definitely get worst, because of the fact that the country becomes less attractive for foreign investors and that at the end of the day would cause the situation to worsen.”
Roets says this will lead to the rand having less buying power.
Speaking to Radio Islam, Biznews.com contributor Gareth Van Zyl added that the weakening rand will have a negative impact on day – to – day costs.
“We’ve already seen government trying to contain the petrol price hike, but that’s not going to last long, that’s a very short term implementation from their side, so we will see another price hike in terms of petrol costs.”
Van Zyl said that the technical recession will hit people where it hurts the most.
“Transport costs, food costs, inflation is going to go up and you going to see things getting more expensive.”
Listen To The Full Interview With Gareth Van Zyl and Neil Roets Below: