South African Reserve Bank (SARB) is likely to announce yet another increase in interest rate, according to economists and experts.

Experts predicted that South Africans are likely to face increased interest rates as the country is dealing with load-shedding and currency crises. Eventually, the pressure will fall on households and businesses as the interest rate will be increased.

The interest rate will be decided by the SARB on Thursday and probably get officially announced on Friday. However, several economists noted that SARB is expected to increase the interest rate by 25 basis (bps) to 8.00%.

The basis point (bps) is a measure that helps the bank to change the interest rate of any financial securities.

An expert named Nicolaie Alexandru-Chidesciuc at JPMorgan explained that the bank might also deliver a 50-bps hike, adding that "The risk of worsening electricity cuts as well geopolitical concerns after the U.S. ambassador claimed the country was not acting in a non-aligned manner in the Russia-Ukraine conflict have significantly impacted the currency," News24 reported.

Chief economist at South African lender Investec, Annabel Bishop, shared that "with the rand's substantial weakness and markedly higher production and retail costs coming from (power cuts), the risk to the inflation outlook on balance is still on the upside."

She explained that the expected hike is 50 basis points rather than a 25 basis points lift. The chief economist went on to share that the credit demand is increasing in households due to less income and eventually, the hiked interest rate will become a pain for South Africans.

Senior economist at South African lender FNB, Koketso Mano, explained that even if the interest rate gets lowered by 2025, the consumer will still be "battling with the price pressures they had to deal with now, and how they might have chosen to deal with them."

This is not the first time that SARB has increased the interest rate. SARB had increased the interest rates in March and in total at least seven times the repo rate has been raised, considering the country is slowly recovering from the impact of the COVID-19 pandemic.

SARB Governor Lesetja Kganyago acknowledged in March that extensive load-shedding, logistical constraints and supply performance of the economy have "severely impaired" the GDP growth of the country.

"Over the forecast period, we expect household spending and investment to grow modestly, even as load shedding and uncertainty continue to weigh heavily on consumption and investment decisions," he said.

He continued, "Private sector investment is expected to remain positive, in large part reflecting efforts to overcome constraints in energy and transport supply. As a result of these factors, the economy is forecast to expand by 1.0 percent in 2024 and by 1.1 percent in 2025."

Load-shedding is a major crisis in South Africa. On Tuesday, the ruling African National Congress (ANC)'s secretary general, Fikile Mbalula admitted that the country could "become a failed state" because of electricity issues.

Energy company, Eskom announced last week that winters are going to be difficult as the country could face Stage 8 of load-shedding. Currently, the country faces Stage 4 and Stage 5 load-shedding.

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