Written By: Tamasha Khanyi
“For households already grappling with high food prices, steep electricity tariffs and unrelenting interest rates, even the smallest increases make a difference,” says Debt Rescue’s Annaline van der Poel.
She has been reacting to this month’s fuel price adjustments.
The price of petrol increased by 1 cent (93 unleaded) and 8 cents (95 unleaded) per litre on Wednesday, while the price of diesel dropped by 8 and 10 cents per litre.
Van der Poel said the marginal adjustments offer little relief to those already struggling with rising costs.
“Diesel powers the trucks and transport networks that move goods across the country. A drop in price does help to ease logistic costs, but such a small decrease is unlikely to filter through to the tools in any meaningful way. The reality is that consumers will continue to pay high prices for food and other essentials,” she says.
“The broader picture is worrying; household-to-debt income levels have climbed to their highest since 2017. Consumer confidence has plunged, reflecting real strain in household finances, and the outlook for the final quarter of the year remains bleak.”
Last month, the South African Reserve Bank Monetary Policy Committee decided to keep the repo rate unchanged at 7%.
The decision was not unanimous. Four members preferred to keep rates on hold, while two were in favour of a 25-basis-point cut.
The central bank made three interest cuts this year alone.
Reserve Bank Governor Lesetja Kganyago said they expect headline inflation to average 3.4% this year, 3.6% next year, before reverting to 3% during 2027.
Headline inflation has increased in recent months, with pressure from meat, vegetables, and fuel prices.
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