Rates & fuel hikes set to hit consumers hard

MANY already over-indebted consumers could fall even deeper into debt due to looming interest rate hikes and increases in the prices of fuel and electricity tariffs‚ Neil Roets, chief executive of debt management company Debt Rescue, said yesterday.

Extremely high levels of debt limit the extent of growth in consumer spending. The fuel price increased by 47c/litre at midnight last night‚ while electricity tariffs will rise further next month by an amount yet to be determined by the energy regulator.

Interest rates are likely to rise before the end of the year.

“The 49c a litre increase in the diesel price is going to impact directly on the prices of essential commodities like food, which in turn is going to hit the poorest of the poor the hardest‚” Roets said.

Independent economist Dawie Roodt said the price hikes in fuel and electricity would place consumers in a situation where they would no longer be able to spend the funds needed to boost growth.

“This, in turn, will impact on unemployment because without substantial growth‚ unemployment is simply going to keep rising and drive more consumers ever deeper into debt‚” Roodt said.

Unemployment rose to 26% in the first quarter from 24% in the previous quarter.

The ratio of debt to disposable income stood at 77.6% in the fourth quarter of last year‚ indicating that households had too much debt for the kinds of income they received.

Like Love Haha Wow Sad Angry

Thank you!

We look forward to the opportunity to get you debt-free!

Did you know?

You can start your application process already. Simply download your assessment or fill in our online application and get one step closer to becoming debt-free with Debt Rescue!

Subscribe to Our Weekly Email

By completing this form, you are providing Debt Rescue with the above personal information and acknowledge the terms of Debt Rescue’s Privacy Notice.