COSATU disappointed but not shocked by the Reserve Bank’s decision to increase interest rates
The Congress of South African Trade Unions is deeply disappointed but not shocked by the inconsiderate decision of the South African Reserve Bank’s Monetary Policy Committee to increase the interest rates by 50 basis point. This decision will squeeze and ultimately decimate an already bleeding working and middle classes.
COSATU is not shocked because the abstract decisions of this privately owned bank are not based on economic reality that is experienced by most South Africans. Workers are already hurting because their meager salaries are not keeping up with escalating prices of energy, food, transport and electricity. The only ones to benefit from rake hikes are banks who will rake in even more money from the poor for their loan repayments.
We reiterate our opposition to the South African reserve bank's continued use of inflation targeting policy as a flagship monetary policy framework. It is not working and excercebates the problems faced by the poor in this country.
This will further repeal their wages and will result in most of them struggling to repay their loans. Our members are amongst the most highly indebted workers because of poor wages as a result of the untransformed apartheid wage structure they are subjected to.
This decision will not only punish working and middle class South Africans, who are already battling to make ends meet but will also reduce expenditure and consumption further stifling economic growth and job creation.