Ten percent (10%) of respondents believe that the hike was an unnecessary adjustment as spending has already slowed down substantially while twenty eight percent (28%) are convinced that it was not enough to quell the domestic thirst for credit. Sixty one percent (61%) say that the latest rate hike will substantially hurt the consumer who is already hard pressed to make ends meet.
While economists maintain that the South African Reserve Bank is edging toward rate hike overkill, Fin24.com editor David MacKay warns that consumer confidence has hit an all time low this year. “Consumer spending drives near 60% of GDP,” says MacKay, “and incessant spikes in the cost of living will take a severe toll on growth this year.”
If one were to draw an analogy between consumer sentiment and Eskom alerts, a recent online measure places the consumer confidence in the critical ‘Brown' stage, he says.
