The escalating conflict between Israel and Iran is sending ripples through global markets, raising concerns over potential economic repercussions especially closer to home in South Africa and the impact on consumers in the country.
Frank Blackmore, the Lead Economist at KPMG, said that the overall impact will hinge on two pivotal factors: the scale and duration of the conflict.
Since the onset of the conflict, oil prices have already begun to rise, and Blackmore stressed the significance of this surge.
An increase in oil prices traditionally translates to higher costs for transportation and goods, which the consumer ultimately endures, he said.
In South Africa, where the economy relies heavily on oil imports, subsequent price increases could put further strain on inflation rates, potentially leading the South African Reserve Bank Sarb to maintain elevated interest rates for an extended period.