Look

This interesting poll showed that many economists worry more about inflation than Trump's proposed tariffs.  Why is this?

A graph of different colored squares

AI-generated content may be incorrect.

Source: NinetyOne

 

It’s because inflation is broad-based (i.e. it affects the entire economy) and driven by wages, housing, and services.  Tariffs, on the other hand, target specific industries. Inflation also hurts consumer confidence and financial markets more than tariffs, which mainly raise costs for certain goods. Unlike a one-time tariff shock, inflation can entrench itself, making it far more damaging long-term – hence the term “sticky inflation.”

Tariffs could potentially be reversed more easily, whereas inflation is harder to fix. Tackling inflation requires higher interest rates, which reduce corporate profits, slow investments, and tighten credit. 

 

Listen

Karyn Maughan is an award-winning South African legal journalist known for her fearless reporting on high-profile court cases, particularly those involving political corruption and state accountability. She played a key role in covering the legal battles surrounding former President Jacob Zuma.

Recently, Zuma attempted to prosecute her privately, accusing her of unlawfully publishing details from a court document related to his medical records. However, in a significant victory for press freedom, the courts ruled in her favour, setting aside the case and reaffirming journalists’ right to report on public court records without fear of legal intimidation.

In this interview with NinetyOne, Karyn shares her experience of being taken to court and how this case has impacted press freedom in South Africa. Her story highlights the importance of protecting journalists from legal harassment and ensuring the public can access truthful, independent reporting.

She also shares her views on the future of Zuma’s MK party and the Government of National Unity.  It’s a hopeful and inspiring message of resilience that I know you will enjoy.

 

Learn

For those who enjoy more technical insights, I thought this was an interesting view on inflation targeting from Coronation.  They argue that South Africa’s current inflation target (3%-6%) is outdated and higher than its peers, potentially undermining economic competitiveness and stability.

While the SARB has successfully managed inflation over the years, a lower target (around 3%) could offer benefits:

 

Long-Term Suitability

In principle, aiming for lower inflation is beneficial for South Africa. It would foster greater price stability, reduce uncertainty, help protect low-income households from the corrosive effects of high inflation, and eventually lower the cost of credit - spurring sustainable growth.

 

Short-Term Realities

However, implementing this change alongside ongoing fiscal challenges could create short-term economic difficulties. South Africa is already grappling with fiscal constraints, major infrastructure and public-sector spending needs, and a sluggish economy. Tightening monetary policy (i.e. increasing interest rates) too aggressively or keeping rates high for too long could deepen the near-term economic drag. 

The idea of introducing a lower inflation target aligns with global norms. However, success depends heavily on careful timing, broader fiscal stability, and strong policy coordination.  This policy may be fundamentally sound, but it would have to be implemented gradually and communicated transparently to avoid undermining SA’s already delicate economic recovery.

 

Ponder

In this section, I invite you to think about a question I may pose or a thought I may share.

Financial stress seeps into every aspect of your life - work, relationships, and health - while the reverse isn’t always true. Security therefore should not be about having more, but about worrying less.

 

Oenophilia

“Oenophilia simply refers to enjoying wine, often by laymen.”

 

I love these beautifully curated wine boxes, called Journey Cases. The wine distributors, Great Domaines, have assembled a selection that transport you to the world’s finest wine regions, all from the comfort of your own home.

 

Stay curious,

Elke Zeki