The governor of the South African Reserve Bank recently announced an increase in the lending rate by 75 basis points. This means the repo rate (the rate at which the central bank lends money to commercial banks) will increase from 5.5% to 6.25% and the prime rate (the rate commercial banks charge their clients when lending them money) rises from 9.0% to 9.75%.
South Africa isn’t alone. Countries across the continent – and the world – have also been hiking rates to manage rising prices. South Africa is the most recent African country to hike rates. Others have included Ghana and Nigeria. And more hikes are expected in the coming weeks.
