February credit growth slows to 20,79%

By Staff Writer

From the Mail & Guardian, Reuters,02 April 2008.

Johannesburg, South Africa  
 
The central bank said on Wednesday private sector credit extension
slowed from a revised 23,06% year-on-year in January, while the M3
money supply growth also fell, to 21,07% from 25,24% year-on-year in
January.

Credit demand was lower than market expectations of 21,48% and M3 money
supply was also slower than the consensus of 22,28 in a Reuters poll.

The Reserve Bank left its key repo rate flat at 11% in January, after
raising it by 400 basis points between June 2006 and December last year.

But inflation continues to accelerate and central bank Governor Tito
Mboweni was hawkish when he spoke in Parliament last week, saying the
economy was not in danger of being strangled by higher interest rates.

Some analysts said the data showed tighter monetary policy was having
the desired effect on indebtedness, and the central bank should not hike
rates.

"The slowdown is good, it is adding weight to calls for the Reserve Bank
not to hike rates next week," said Colen Garrow, economist at Brait
Merchant Bank.

"Additional momentum behind the view is that the consumption side of the
economy is slowing fast. To hike rates would be a bit too much," he said.

But the data may not be enough to deter the central bank after CPIX
inflation reached a five-year high of 9,4% in February, much higher than
the 3% to 6% target band.

"I still think given the very high inflation figures, this cooling is not
enough to provide a counter," said Fanie Joubert, economist at Efficient
Group.

The central bank's Monetary Policy Committee meets on April 9 and 10.

The rand was almost unchanged after the data at 7,97 to the dollar at
6.30am GMT, from 7,9725 before the data. The yield on the 2015 bonds was
lower at 9,125% from 9,155 before the data.
 

Recent Articles

Featured 5 Ways to fireproof your house

It’s a fact that some homes are more prone to fire than others. A tragic example of this is the horrific 2017-Knysna wildfires in which people lost their lives and homes. How can you fireproof your house? Justmoney learnt five things you can do to improve safety and reduce the risk of damages.

 

Read more

Do you still need credit life cover when you have life cover?

When you take out credit, your creditors will require you to pay back what you owe no matter what your circumstances are. This is why they have credit life cover built into their loans to ensure you are still able to pay off your debt, should any unfortunate event occur. 

 

Read more

Are you ready to just tap and go when you pay?

The integration of the tap and go system has revolutionised the way consumers make payments. Instead of having to insert or swipe your card, you are now able to simply tap and have the payment registered almost instantaneously. But how safe is this?

Read more

Debt consolidation – Explained

Dealing with debt can be daunting. If you’re struggling to keep track of which store account to pay next and weighing up which credit card is more important to settle first, you may have considered debt consolation. At Justmoney, we’ve decided to get down to the basics and explain what this entails and what impact you can anticipate on your credit score.  

Read more

Sign Up

To our weekly newsletter for advice you can bank on

Deals

Senior Citizens Property Rebate

Price: Available on request
When: Daily
Where: Nationwide

100% on disability cover premiums

Price: Available on request
When: Daily
Where: Nationwide

Cubana Breakfast Special

Price: R37
When: Daily
Where: Nationwide