Die ekonomie minuut

Last week the Economist magazine released their latest Big Mac index. According to that, the rand is 54.5% undervalued against the US dollar. This means that the rand should actually be trading at R7.75 per dollar, rather than the R17 per dollar we see in the market. How does that work, and what does it mean?

* The Economics Minute is supported by the NWU Business School.

The Reserve Bank's Monetary Policy Committee yesterday announced the largest single repo rate increase since September 2002 when they increased the policy rate by 75 basis points to 5.5%. In the media, economists give good explanations about why it is important to fight high inflation with high interest rates, but on Twitter people are disappointed and angry. We don't explain as well as we think, so I want to try again.

* The Economics Minute is supported by the NWU Business School.

Die Reserwebank se Monetêre Beleidskomitee het gister die grootste enkele repokoers verhoging sedert September 2002 aangekondig toe hulle die beleidskoers met 75 basispunte verhoog het tot 5,5%. In die media gee ekonome mooi verduidelikings oor hoekom dit belangrik is om hoë inflasie te beveg met hoë rentekoerse, maar op Twitter is mense teleurgesteld en kwaad. Ons verduidelik nie so goed soos wat ons dink nie, maar ek wil nog ʼn keer probeer.

* Die Ekonomie Minuut word ondersteun deur die NWU Sakeskool.

Junie-maand se verbruikersprysinflasiesyfer is gister bekend gemaak en het gestyg van 6,5% in Meimaand tot 7,4%. Die styging is gedryf deur stygings in die pryse van voedsel en vervoer. Wanneer die Monetêre Beleidskomittee oor hierdie syfers dink vir vanmiddag se repokoers besluit weet hulle dat inflasie is nou hoog en volgehou, en hulle kan nie net niks doen nie.

* Die Ekonomie Minuut word ondersteun deur die NWU Sakeskool.

Kyk ook sommer na my nuwe blad: econ101.blog.

June's consumer price inflation figure was released yesterday and rose from 6.5% in May to 7.4%. The increase was driven by increases in food and transport prices. When the Monetary Policy Committee thinks about these figures for this afternoon's repo rate decision, they know that inflation is now high and sustained, and they can't just do nothing.

* The Economics Minute is supported by the NWU Business School.

Also, check out my new site: econ101.blog.

Terwyl ons wag vir vandag se inflasiesyfers is daar kans om oor iets interessant te praat. Ekonome praat van die Bruto Binnelandse produk en is maar altyd bekommerd oor die groei van die ekonomie. Daar is egter mense wat krities is oor die BBP as maatstaf van hoe dit met die ekonomie gaan. Die meting vat maar ʼn raaiskoot oor die informele sektor, dit neem nie skade aan die omgewing in ag nie en sê niks oor hoe gelyk of ongelyk inkomste verdeel is nie. Daar is nou ʼn nuwe maatstaf wat hierdie laaste punt probeer aanspreek.

* Die Ekonomie Minuut word ondersteun deur die NWU Sakeskool.

Kyk ook na my nuwe blad www.econ101.blog.

While we are waiting for today's inflation figures, there is a chance to talk about something interesting. Economists talk about the Gross Domestic Product and are always worried about the growth of the economy. However, there are people who are critical of GDP as a measure of how the economy is doing. The measurement only takes a guess at the informal sector, it does not take into account damage to the environment and says nothing about how equal or unequal income is distributed. There is now a new measure that tries to address this last point.

* The Economics Minute is supported by the NWU Business School.

Also, check out my new page www.econ101.blog.

Een van die dinge wat die Monetêre beleidskomittee hierdie week gaan sê is daar is sogenaamde “upside risks” vir inflasie. Dit is dinge wat kan gebeur wat inflasie verder sal verhoog. Omdat daar ʼn kans is dat dit kan gebeur moet hulle voorkomend optree en die repokoers verhoog. Maar wat is hierdie risiko’s en hoe word hulle geweeg?

* Die Ekonomie Minuut word ondersteun deur die NWU Sakeskool.

Kyk gerus na my nuwe blog: econ101.blog

One of the things the Monetary Policy Committee is going to say this week is that there are so-called "upside risks" to inflation. These are things that can happen that will further increase inflation. Because there is a chance that this can happen, the Bank must act proactively and increase the repo rate. But what are these risks and how are they weighed?

* The Economics Minute is supported by the NWU Business School.

Check out my new blog: econ101.blog

This week, inflation and the repo rate will dominate the economic news. The Reserve Bank's Monetary Policy Committee meets from Tuesday, the June consumer price inflation number will be announced on Wednesday and the repo rate decision on Thursday. Economists expect a further rise in consumer price inflation. It was 5.9% in April, 6.5% in May and is forecast to have been above 7% in June. This means that the Reserve Bank has to be strict now.

* The Economics Minute is supported by the NWU Business School.