There is growing concern around how South African households will finance their future emergencies, as savings took a dip in the second quarter of 2026.

The South African Reserve Bank’s September Quarterly Bulletin shows that while debt increased at a slower pace, household savings deteriorated. South Africa’s national savings rate fell from 14.9 percent in the first quarter of the year, to 10.8 percent in the second.

The declining savings rate in South Africa has raised questions about how much longer households can sustain their spending if the cost of living comes under renewed pressure.

The Reserve Bank’s latest Quarterly Bulletin reveals household spending rose 0.4%, led by durable goods and services. Head of the economics statistics department Michael Manamela says the growth came from a flat base in the first quarter.

“What I think is quite clear is that we are coming from a basic effect in Q1, which was flat. Of course, we saw supposedly income improving, and that also led to us seeing that the debt levels of households also declined. What is, of course, concerning is the savings rate. We saw corporate savings rate decreasing of course with households because it’s smaller than corporates and I think that means a concern to say how will households going forward be able to afford their consumption.”

The economy and financial system remain vulnerable to geopolitical tensions, particularly the US war on Iran, which has raised global oil prices. Manamela says that puts price pressures on the economy.

“What we have seen in the South African economy is that inflation is still elevated, above the target of 3%. I think August was 4.4%, and that continues to put pressure on the economy. Til prices remain also elevated, and those feed through the entire economy. We do have the prospects of El Nino that is mostly going to fit into the food prices. Although food prices have slowed down in the recent months, I think the risks remain elevated.”

Adding salt to the wound is the country’s high unemployment rate. South Africa’s official unemployment rate increased further from 32.7% in the first quarter to 33.6% in the second quarter of 2026.