The Congress of South African Trade Unions (COSATU) is deeply disappointed that the South African Reserve Bank (SARB) failed to cut the repo rate to provide badly needed breathing space to millions of workers struggling to cope with the rising costs of living. This was an unnecessary missed opportunity to give workers and the economy badly needed relief.
The SARB needs to seize the opportunity of an inflation rate that has been consistently falling and at 3.5% is well within the inflation target range and utilise its March Monetary Policy Committee meeting to slash the repo rate by at least 50 basis points.
Workers are barely surviving with electricity and fuel price hikes far above inflation. Their wages have not kept pace with these increases. Workers are supporting relatives who cannot find jobs in an economy stumbling along an average 1% annual growth and with a 42.4% unemployment rate with deeply alarming numbers of jobs being shed by various companies. The National Credit Regulator’s debt reports shine a deeply worrying spotlight on workers’ dangerously high levels of indebtedness.
The two years of repo rate hikes in response to the war in Ukraine and the subsequent spike in international oil prices inflicted real damage on the South African economy and workers have been made to pay the price with an abnormally high repo rate, making servicing debt even more difficult and denying a struggling economy critical stimulus.
A bold and progressive repo rate cut in March will ease workers’ debt burdens, help them to take care of their families and pay their debts, and inject badly needed stimulus into an economy suffocating from high lending rates.
The Federation hopes the SARB will not once again disappoint workers when it meets in March. It needs to act on the side of workers and provide badly needed comfort for a nation that has seen its share of negative headwinds.
COSATU will continue to engage with and push the SARB on this burning matter for the working class and the economy.
Issued by COSATU
Matthew Parks (COSATU Parliamentary Coordinator)
Mobile: 082 785 0687
Email: matthew@cosatu.org.za
