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Thread: Interest rates down .5%

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    Interest rates down .5%

    I am sure every one can now have a less stressful Christmas
    We have reached the summit and for the next 2 years ( my opinion ) rates will be going down.
    I expected a 1% drop, but far be it from me to dictate to our governor.
    Is this too little to late, I believe for most the relief came to late and many over indebted consumers lost the homes.
    It is not the end of the world and in 5 years your difficulties will be just a memory

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    Site Caretaker Dave A's Avatar
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    .5% isn't going to kick-start anything - it just takes the screws off a turn. But it is some relief.

    I suspect ordinarily a 1% drop would have been more appropriate for the economic climate. But at this time of year it could also have sparked an excessive Christmas shopping spree.

    Let's look on the bright side. Fuel costs down and interest rate trends turned - the light at the end of the tunnel is starting to show.
    The trouble with opportunity is it normally comes dressed up as work.

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    Platinum Member Marq's Avatar
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    I have no idea what you lot are on about.

    For the first time in my life I have bucks in the bank and no debt - doing what I have been preaching to you about.

    So I think the interest rate should be increased .
    Christmas is going to be bleak for me - this is not what I ordered.

    Minority Rules.
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    Site Caretaker Dave A's Avatar
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    But now all those people and companies with interest bearing debt might be able to spend a bit of money on things - like going to B&B's
    The trouble with opportunity is it normally comes dressed up as work.

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    Platinum Member Marq's Avatar
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    Haha

    Yes Dave, I certainly hope it injects some enthusiasm to get out there because the general feeling is one of doom and gloom at the moment.
    The cost of living hasn't affected its popularity.
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    Gold Member garthu's Avatar
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    Hmmm... word is out we could anticipate a significant ineterest rate decrease, maybe as early as this week... Significant? Maybe 1%.. dunno but the excitement... canmt evenn spell coreeectly
    Garth

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    Site Caretaker Dave A's Avatar
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    I heard that too.

    Just at the moment you have to wonder whether the driving force behind this sudden eagerness to move the rate along is economic data or politics

    Maybe I'm getting too cynical, but when JZ wheeled out an obviously very frail Madiba I realised there is nothing this joker won't do.
    The trouble with opportunity is it normally comes dressed up as work.

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    Site Caretaker Dave A's Avatar
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    I guess this answers my question:
    South Africa's real gross domestic product (GDP) at market prices on a quarter-on-quarter (q/q) seasonally adjusted annualised (saa) basis dropped by -1,8% in the fourth quarter of 2008 from +0,2% in the third quarter, Statistics South Africa (Stats SA) said on Tuesday.

    Non-seasonally adjusted year-on-year GDP in the fourth quarter was placed at 1,0% from a revised 3,0% (2,9%).

    Non-seasonally adjusted year-on-year GDP in the fourth quarter, excluding agriculture, was placed at 0,8% from 2,7% in the third quarter.

    The main contributors to the decrease in economic activity for the fourth quarter of 2008 were manufacturing (-3,5 percentage points), electricity, gas and water (-0,1 percentage points), wholesale and retail trade, hotels and restaurants and the mining and quarrying industry (0,0 percentage points).

    These were counteracted by increases in finance, real estate and business services and general government (+0,6 percentage points), agriculture, forestry and fishing (0,5 percentage points), construction (0,4 percentage points) and transport storage and communications and personal services (0,2 percentage points).
    full story from M&G here
    But here's the shocker.
    The killjoy in South Africa's economy is the manufacturing sector, which has just reached its worst level since 1960.

    According to data released on Tuesday, South Africa's manufacturing sector is not only in a recession, it is dropping at rates last seen before television had even been introduced into the country.

    Manager of GDP at Statistics South Africa, Kedibone Mokone, confirmed that manufacturing was at a worst level since 1960.

    According to Tuesday's data, manufacturing dropped a mammoth -21,8% quarter-on-quarter (q/q) seasonally adjusted annualised from the -9,4% in the third quarter and contributed -3,5 percentage points to the total q/q drop of -1,8%. Two consecutive quarters of negative growth is a recession. Manufacturing had surprised with growth of 14,3% in the second quarter.
    full story from M&G here
    The trouble with opportunity is it normally comes dressed up as work.

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    Gold Member garthu's Avatar
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    I think its both. Quite entertaining that reports suggest that these figures and current position almost come as a suprise Further that need for action is required The major players at the helm are clearly not in touch with whats happening on the ground as it's been quite obvious for a while that even "desperate" could be used to describe.

    At a strat. meeting today there was agreement with elections we would see 2 % very soon, 1 now and another April - but politically motivated as equally as situation
    Garth

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    Site Caretaker Dave A's Avatar
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    South Africa's targeted headline consumer price index (CPI) inflation slowed to 8,1% year-on-year (y/y) in January but was above forecasts, although this was unlikely to dim expectations of an early interest rate cut.

    Statistics South Africa said on Wednesday that inflation slowed from 9,5% in December, while month-on-month inflation stood at 0,4% in January, the first month under a revised, re-weighted price basket.

    This is the fifth monthly decline after the record 13,6% registered for CPIX -- the old targeted measure -- in August last year and the 13,7% for the old CPI in August.
    full story from M&G here
    Although there seems to be disappointment it wasn't even lower, I think this still shows a big improvement in the inflation outlook. Right now we don't need to slam below 6% because we're sure to overshoot the mark if we do.

    Easing to it will do just fine. Particularly as there are bigger problems pressing right now.
    The trouble with opportunity is it normally comes dressed up as work.

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