Expert analysis on future interest rate announcements.
Category Finance
Debt holders are likely to be sitting on the edge of their seats ahead of the next interest rate announcement which is set to be held on 27 March 2024. The promise of an interest rate cut has been floating around for some time now, but this next announcement might just see the promise being realised.
In January the SARB's Monetary Policy Committee decided to keep the repurchase rate at its current level of 8.25% per year.
Although hopeful that March might be the month that we see a 0.25% drop, Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, warns consumers not to expect any dramatic rate cutting cycle to begin. "Many economists predict that at best, interest rates will only come down by 1% over the course of the year, which will still leave us at a higher rate than we were pre-Covid."
Focusing on the positive, Goslett says that even a 0.25% drop in interest rates can go a long way towards relieving some of the financial pressure many households are undoubtedly facing.
However, if we do experience a cut, Goslett's advice to consumers is to work wisely with any money that is freed up as a result. "If you can afford to keep your repayments where they were before the cut, then I would strongly recommend that you do so, as this will help you to pay off the debt faster and reduce the amount of interest payable over the loan term," says Goslett.
Author: Property24
