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SA household resilience is on the recovery path – Altron index

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GUEST - Dr Roelof Botha - Economist
The results of the most recent Altron FinTech Household Resilience Index (AFHRI) were released this month, confirming the continued financial pressure on South African households, mainly due to the high interest rates over the past two years, which have raised the average debt cost burden to its highest level in 15 years.
According to economist Dr Roelof Botha, who compiles the index on behalf of Altron FinTech, the restrictive monetary policy stance by the Monetary Policy Committee (MPC) of the South African Reserve Bank (SARB) has come at a huge cost to the economy. Botha says: “One of the most worrying trends in the latest AFHRI is the year-on-year decline of 3.3% in the ratio of household income to debt costs. Merely two years ago, in the first quarter of 2022, households were sacrificing 6.7% of their disposable incomes to pay for debt costs. This ratio has since increased by 36%, with households now having to spend 9.1% of their disposable incomes on servicing debt.”
3 Feb 2PM English South Africa Business News · Investing

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