FNB leaves prime lending rate unchanged

"We still urge consumers to use the present stable rates environment to reduce their debt," says Jacques Celliers, CEO of FNB. "The bank continues to forecast rates hikes over the medium term, and consumers should act with care and plan ahead. Certain retail loans can be consolidated at lower rates via our Credit Card division. Investors seeking interest income should consider higher-yielding accounts such as our inflation-linked and fixed-term products."

Sizwe Nxedlana, chief economist at FNB, says the SARB remains in a stag-flationary bind with growth in the economy weak and inflation above target. "Whilst the SARB opted to leave rates unchanged at today's meeting, we remain of the view that a gradual normalisation of interest rates will continue during 2015 and 2016. The timing of rate hikes will be dependent on domestic growth considerations and the timing of rate normalisation in the US. Clients are advised to plan for higher interest rates over the medium term and to use the current low rate environment to pay down debt."