ARE CON­SUMERS RE­ALLY UN­DER CREDIT PRES­SURE?

Finweek English Edition - - SIMON SAYS -

Tru­worths re­sults shared an in­ter­est­ing com­ment: “Man­age­ment feels that the credit en­vi­ron­ment is steadily im­prov­ing de­spite the cur­rent tough eco­nomic en­vi­ron­ment.” I have been won­der­ing about this. Ev­ery­body seems to as­sume t hat con­sumers are un­der i ntense pres­sure, but are they? Even with re­cent in­ter­est rate hikes we’re at multi-decade lows and while the econ­omy is very gloomy, that does not au­to­mat­i­cally mean the con­sumer is as well. Cer­tainly we’re not see­ing bad debts ex­plod­ing, as they re­main largely f lat. The risk of course is weak­en­ing con­sumers go­ing for­ward as rates in­crease and the rand weak­ens.

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