SA’s Prospects for 2012

What Are The Prospects For SA’s Economy in 2012?

South Africa’s money matters are intertwined with the rest of the world, which is presently under pressure. If others stumble, so will we.
America does not seem to be making much economic progress, and Europe isn’t making progress in solving its crisis. The Middle East and North Africa still remain unstable, too.
The oil price still remains at $100 a barrel.
Inflation:
• The inflation rate is set to exceed 6% by the end of 2011and should remain there for the first part of 2012, but will gradually drop towards the end of the year.
• It seems that an average rate of 5.6% inflation rate is expected in 2012, compared to that of 2011 which stood at 5%.
• Increases in municipal bills could add pressure on the individual pocket.

Interest Rates:
• Interest rates have dropped 6,5% over the past 5 years.
• This makes debt less stressful.
• The prime lending rate is 9% and has said to remain stable this year, and could be the trend right into 2013.
• If interest rates do change, they are more than likely going to drop and not rise.
• This does not bode well for pensioners that are living on interest.

Our Rand:
• The longer the situation is drawn out in Europe, the longer the rand will remain weak.
• This does not bode well for people travelling abroad and also for those that import.

Live within your means and avoid unnecessary debt and continue to save as best you can.