Surprise interest rate hike

Blame quantitative easing and tampering off by the US. Reserve banks are now trying to protect currencies.

There is a big global economy correction coming that should've happened in 2008-2009.
 
I'm glad for all you people who think 50bp is not enough, etc etc.. Some of us are trying very hard to keep costs under control, but with everything spiraling upwards, its getting difficult.

There are a huge number of people who can barely afford the 50bp hike. Banks are going to be repo'ing lots of stuff very very soon. Any more than another 50bp and I shudder to think whats going to happen to the housing market tbh...
 
ToxicBunny said:
This country can't afford to have it go much beyond 10% if you ask me..

The level of house repo's will go through the roof and it will cause untold chaos in the banking sector.
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Agreed, but it does need to go up to try and bring down prices(bring in some foreign capital to drop the R/$ rate and price of oil)


daveza said:
Seriously ?

I've seen destitute church mice living better than me.
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I bet that church mouse did not internet :twisted:
 
R13... said:
On the + side there might be some good deals properties coming our way soon :D. Sorry for those who bought borderline affordable, good thing I turned down a prime -1% on a property because I thought there's too much upward risk on interest and told the bank I will only accept prime -2
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I kept my head down, and didn't buy anything spectacular :D. Paid extra each month .. because sooner or later they are going to increase the interest rate.


Good luck to us all if they start increasing rates to 15-16%.
 
ToxicBunny said:
I'm glad for all you people who think 50bp is not enough, etc etc.. Some of us are trying very hard to keep costs under control, but with everything spiraling upwards, its getting difficult.

There are a huge number of people who can barely afford the 50bp hike. Banks are going to be repo'ing lots of stuff very very soon. Any more than another 50bp and I shudder to think whats going to happen to the housing market tbh...
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Not so long ago it was over double what it is now so hold on to your hat.
 
Zerohedge Tweets:

Worst. Intervention. Ever. S. AFRICA RAND FALLS TO RECORD VERSUS EURO
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Pretty much sums the whole thing up.
 
lucifir said:
Agreed, but it does need to go up to try and bring down prices(bring in some foreign capital to drop the R/$ rate and price of oil)




I bet that church mouse did not internet :twisted:
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Agreed in principal, but I think at the moment with everything thats going on, the rand is going to fall regardless of what the SARB do... so hurting the citizens who own property etc etc etc doesn't really achieve anything good in my opinion.
 
R13... said:
good thing I turned down a prime -1% on a property because I thought there's too much upward risk on interest and told the bank I will only accept prime -2
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And it's a good thing you tell us all about it too, so we can try the same and get our banks to tell us to go **** ourselves :D

If this trend continues I'm going to start considering getting out of SA for real. For a few years at least.
 
Prime will have to be above 12% to cause major concern to those that are looking to take on good debt, imho.

Does anyone know what the reaction is like on the bond market?
 
On a bond of a bar, the interest rate hike is going to cost you like R250 a month extra no? That's not even bread and milk money for a week . If that's going to break the bank then people should have thought about what they bought before they jumped in with both feet, all the laundry, cats, dogs, children and grandparents
 
ToxicBunny said:
Agreed in principal, but I think at the moment with everything thats going on, the rand is going to fall regardless of what the SARB do... so hurting the citizens who own property etc etc etc doesn't really achieve anything good in my opinion.
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True, but they had to try something.
I think its them just testing the waters.
Honestly, very surprised that they did this so close to a national election.
Would have thought they would hold off at least until after voting day.

But it seems their timing was terrible as all the speculators are focusing on the FOMC, and a 50 basis point increase in SA is not worth taking note of. They should have made the announcement tomorrow, after the FOMC meeting, as it would have had a much bigger impact and better received.
 
McSack said:
On a bond of a bar, the interest rate hike is going to cost you like R250 a month extra no? That's not even bread and milk money for a week . If that's going to break the bank then people should have thought about what they bought before they jumped in with both feet, all the laundry, cats, dogs, children and grandparents
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I guess that's true, but what will likely happen is people will panic and the property market, spending, etc will all suffer for it. Can't say I'd blame anyone for wanting to hold on to the money they have, it will be real difficult if you're an estate agent round about now.
 
McSack said:
On a bond of a bar, the interest rate hike is going to cost you like R250 a month extra no? That's not even bread and milk money for a week . If that's going to break the bank then people should have thought about what they bought before they jumped in with both feet, all the laundry, cats, dogs, children and grandparents
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nevermind.. I was checking if it increase with 1% earlier today
 
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McSack said:
On a bond of a bar, the interest rate hike is going to cost you like R250 a month extra no? That's not even bread and milk money for a week . If that's going to break the bank then people should have thought about what they bought before they jumped in with both feet, all the laundry, cats, dogs, children and grandparents
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R250 is your bread and milk money for a week?!?!?!

Jees dude... I don't spend more than R60 per week on bread and milk.

Btw, your calc is wrong, on a bond of a bar, the 50bp hike equates to R357 extra per month.
 
Don't forget about FOMC at 21:00 tonight. The Fed will likely reduce asset purchases a further 10 Billion. If they do the Dollar should strengthen further(but it should be largely priced in at this point). If they don't and keep things the same there should be quite a strong dollar sell off.

The bottom line is world markets are risk averse at the moment with EM currencies taking the brunt of it.
 
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