Despite the relief of no VAT increase and an inflation rate below the Reserve Bank’s target range, many South African consumers will still rely on credit to get through the month.
Unfortunately, the South African Reserve Bank (SARB) expects inflation to tick up to an average of 3.6% in 2025 and continue rising to 4.5% in 2026. This, combined with global uncertainty, means the central bank is unlikely to make any further rate cuts.
“Add increased electricity costs, tax bracket creep, and ever-increasing service delivery costs to the mix of diminishing spending power, and it is understandable why so many consumers will continue to depend on credit,” says National Debt Counsellors’ Association chairman, Benay Sager.
Read the article in the Business Report.