By Zuko Komisa
New research has revealed that households in SA are R253 billion poorer in Q3 due to rising interest rates.
According to the most recent Momentum/Unisa South African Household Wealth Index for the third quarter of 2022, South African households are losing wealth.
According to the study, households lost an estimated R253 billion in the third quarter of 2022, following a decline of R1.275 trillion in the second quarter.
According to the organisation, the value of South African household wealth dropped from R15.5 trillion in the first quarter of the year (Q1 2022) by almost R1.528 trillion.
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Kaya Biz with George Manyosi in for Gugulethu Mfuphi spoke to Johann van Tonder, who is an Economist for Financial Wellness at Momentum.
“This is a very tough time for households actually, that’s the short version because if you really dig deep you’ll realise that household wealth is at the same level as it was in the first quarter of 2015, in other words, 7 years ago.
“Basically, what has happened in the last 6 months is, central banks all over the world and here in South Africa started to increase interest rates with the intention of bringing inflation down. normally when that happens your stock markets go down, and when that happens values of house pension funds and investments goes down, ” says van Tonder.
According to the research in the six months from the first quarter of 2022 (Q1 2022), the value of South African households’ wealth (expressed in current prices) declined by an estimated R1.528 trillion (R1 528 billion) to R15.5 trillion.
The value of household wealth (in current prices) decreased by R9.3 billion, or 0.1%, from a year earlier (Q3 2021), implying that any initial gains made in the subsequent six months up to Q1 2022 were more than reversed in the subsequent six months up to Q3 2022.
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