For many years, even as a child I started to consider the effects of the rising cost of acquiring the mere necessities, for example, electricity, water, and food.
The man on the street is hit the toughest with report rate increases. Why? Because with every increase in the repo rate, the banks increase their loan and overdraft rates, because they have a business to run and make a profit. The man on the street are the ones with housing loans, hire purchase agreements/lease agreements to enjoy the quality of life, as they wish.
What can happen if they do not increase? Let’s look at it from the bank’s point of view. The rate of return on their investments will become less.
The repo rate is the rate at which the Bank of Namibia lends money to commercial banks in Namibia. The rate is set by the Bank’s Monetary Policy Committee and is adjusted for the purpose of keeping inflation below the target limit. It makes sense to me.
TIP: In this case, you have an opportunity to save. On a tight budget, unexpected expenses may be the last thing you need. Try to avoid this by putting some money away into an emergency savings pocket that you can access anytime. Make a list of your needs and wants and challenge yourself to only spend on your needs. The money that you would have spent on your wants can be deposited into a savings account.