The Congress of South African Trade Unions (Cosatu) on Friday warned of largescale job losses as small businesses face foreclosure following the increase in the repo rate.
The South African Reserve Bank announced a 25-basis points basis hike on Thursday, bringing the repo rate up to 7.25%. This makes it the eighth consecutive hike.
Cosatu joined the South African Federation of Trade Unions in its criticism of the central bank’s decision.
Cosatu said there will be dire consequences for the country’s lower and middle classes following the latest hike in interest rates.
This means consumers will have to set aside a little more money from their disposable income to service their debts.
Cosatu said the growing economic pressure on households could see low-earning workers lose their homes and cars.
The federation added that the sustainability of small businesses is also under threat, with workers at risk of losing their jobs if business owners can’t keep their doors open.
Cosatu also accused the government of leaving poor families to their own devices, adding that the government must find and address the root causes of the ailing economy.
