Finance union Sasbo has called on all of its 66 000 members to petition the governor of the Reserve Bank, Tito Mboweni.

The union, a Cosatu affiliate, called upon all of its members on Wednesday to send faxes to the SA Reserve Bank asking Mboweni "not to hike interest rates any further".

Should rates rise yet again, this would only cause further hardship, retrenchments and higher unemployment, Sasbo said.

"The union is of the opinion that South Africa is currently facing higher rates of inflation, not necessarily due to poor macro economic management, but largely because of high global oil and food prices, factors totally outside the control of the South African Reserve Bank."

Sasbo General Secretary Shaun Oelschig said: "Inflation, as presently being experienced, is for the most part imported."

Raising interest rates further would have no impact on the international price of grain, food or fuel, and Eskom's tariff hikes would be inflationary irrespective of what the central bank does, Oelschig said.

"Further raising of interest rates would rather weaken the economy and cause higher unemployment."

With the repo rate at 164 percent of the June 2006 level, interest rate increases had had the desired affect of slowing household consumption expenditure, he added.

However, further rate hikes would only result in a backlash from labour unions because workers would be unable to survive on their wages.

"Tantamount to an overdose"

"The side-effects of the increased interest rate medicine would be worse than the disease as it would be tantamount to an overdose," Oelschig said.

Asked how Governor Mboweni would react to receiving 66 000 faxes, the SA Reserve Bank's spokesperson Samantha Henkeman told Sapa that the institution would only comment once it received the faxes.

"We've not received any," she said.

The SA Reserve Bank's Monetary Policy Committee is due to meet on 11 and 12 June to discuss whether or not to hike the repo rate.

Sapa