What The Consumer Can Expect in 2012
What The Consumer Can Expect in 2012
The World Is Presently A Place of Uncertainly
The world and Europe is a place of uncertainty according to Ulrich Joubert, economist. America needs Europe to get its finances in order, and China claims that the uncertainty in Europe is stunting its growth.
Greece has a debt of 160 % of its gross domestic product, and there will be negative consequences as a result.
There are even bigger problems in the Italian and Spanish economies, making the world and economists nervous.
It is up to the European leaders to make an effort to spare the global economy from suffering.
If these issues are not resolved then SA could face a weak economic growth.
This is how the fallout of the Arab Spring and the European debt crisis has had an affect on SA:
• Inflation is set to exceed 6% in 2011 and continues to remain there for the first part of 2012.
• The longer the situation drags on in Europe, the longer the rand could remain weak.
• The housing market is likely to remain bad during 2012, and also for the next couple of years.
• Before the Arab Spring towards the end of 2010, the oil price was about R720 a barrel, but who could have guessed that it would rise to R1 020 , and by December 2011 the oil price per barrel was R935 a barrel.
• Unemployment will continue to be problematic as a result of poorer economic growth.
• The price of grain and wheat is high and is more than likely to continue to be that way for a while. Food prices have been rising faster than consumer goods in general. Higher maize prices internationally have had a negative effect on food prices, and this is mostly due to a poor crop in America. When the first of the local crops have been harvested after the first quarter of the year, this is believed to improve.
It is therefore advisable to reign in your finances, live within your means and avoid any unnecessary debt, whilst continue saving.