There is therefore an understandable pressure on the Reserve Bank to do something that will bring interest rates down immediately and effectively for all borrowers in the South African market. Can the Reserve bank do anything to salvage this situation?
There was, though, some softening around the middle of the year, and sentiment among many businesses, including some that had seen important positive spillovers from the mining boom, became less optimistic. Associated with this, the labour market softened in the second half of the year, with job vacancies declining, employment growth slowing, and unemployment increasing somewhat. Labour force participation also declined.