Economists warn of further interest rate hikes

Economists says there is a possibility of another interest rate hike in April

Economists have warned that consumers could be in for a major shock with the release of the February Consumer Price Index (CPIX) data today. The CPIX is used by the Reserve Bank as a measure for the inflation.

When the CPIX rises above the bank's 6% point, the bank increases interest rates. Several economists say the figure for last months CPIX is close to 10%. This would be the highest since March 2003.

Economist Russel Lamberti says there is a possibility of another interest rate hike in April due to strong inflation numbers. Meanwhile the fuel price and electricity tariffs are expected to rise in April.

Eskom has been granted a 14% tariff hike, and it has applied for a further 53% increase. Fuel prices are set to rise due to the under-recovery on petrol at almost 56c/l and an 11c a litre hike in the fuel levy, announced in the budget, kicks in April.