First National Bank (FNB) said it would maintain its prime lending rate at 9,25 percent following the decision earlier on Thursday to keep rates on hold until the next meeting of the South African Reserve Bank Monetary Policy Committee (MPC). The meeting is scheduled for November 20. “We still urge consumers to use the present stable rates environment to reduce their debt. The bank continues to forecast rates hikes over the medium term, and consumers should act with care and plan ahead.
“Certain retail loans can be consolidated at lower rates via our Credit Card division. Investors seeking interest income should consider higher-yielding accounts such as our inflation-linked and fixed-term products,” said Jacques Celliers, CEO of FNB. Sizwe Nxedlana, Chief Economist at FNB said the SARB remained a stagflationary bind with growth in the economy weak and inflation above target. “Whilst the SARB opted to leave rates unchanged at today’s meeting, we remain of the view that a gradual normalisation of interest rates will continue during 2015 and 2016. “The timing of rate hikes will be dependent on domestic growth considerations and the timing of rate normalisation in the US. Clients are advised to plan for higher interest rates over the medium term and to use the current low rate environment to pay down debt,” he said.