Reserve Bank Increase Interest Rate By 0.5% - Home Loan Prime Rate Now 11.25%

South Africa's central bank this afternoon announced that interest rates will be hiked - to a 13-year high - with 50 basis points. This raises the key rate from 7.25% to 7.75%. In turn, the prime lending rate (the rate of interest commercial banks charge their clients when granting a loan), will increase from 10.75% to 11.25%.

Market experts attribute the rate hike to inflation. Stats SA published the latest inflation numbers on 22 March 2023, which showed a slight uptick in headline inflation to 7% (up from 6.9% in January), with core inflation accelerating to 5.2% (from 4.9%).