Motorists are lining-up at petrol stations across the country ahead of the midnight fuel price hike. The Energy Department announced fuel price increases of between 99 cents and R1.24 per litre in October.
Motorists say the hike will affect them. Aliah Hussein is a single mother of two and says the cost of taking her children to school will also increase.
“I’m a single mother; I have my children plus this fuel price which is increasing. It’s affecting on our family, everything because school transport is increasing.”
Quantitative Analyst, Olebogeng Moeng says his budget is going to take a knock. “There’s a certain budget that I work with and this has taken me completely out of budget. On a monthly basis I’ve been spending just round about R2000. There are quite a number of plans that I have in place and chances are I’m going to have to drop either one or two of them.”
The energy department reported that contributions to the fuel hike came from higher in Brent crude oil prices and a weaker currency.
Weak Rand
The weak rand is a major reason for the latest fuel price increases. Motorists say the hike will affect them and their daily living.
The Reserve Bank says it will only intervene to protect the currency if “excess volatility” threatens the orderly functioning of the market.
Deputy Governor Daniel Mminele was speaking in New York in the US. The Bank primarily uses the repo rate and the inflation target set by government to achieve this.
But Mminele says foreign exchange intervention is still part of monetary policy to ensure economic and financial stability.
The Reserve Bank two weeks ago resisted political pressure and kept the repo rate at six point five percent. The ANC released and then retracted a statement calling on the bank to do more to support the economy.
The independence of the Reserve Bank is written into the constitution. – Additional reporting by Reuters.
