Pri­vate sec­tor credit at 6.16% year-on-year

The Star Early Edition - - BUSINESS REPORT -

DATA re­leased yes­ter­day by the SA Re­serve Bank showed that South Africa’s pri­vate sec­tor credit rose 6.16 per­cent year-on-year in June, eas­ing from a 6.69 per­cent rise year-onyear recorded in the pre­vi­ous month as the sub­dued busi­ness and con­sumer con­fi­dence weighed down credit ex­ten­sion in the pe­riod. The “other loans and ad­vances” com­po­nent de­clined R6.1 bil­lion com­pared to an in­crease of R10.4bn in May as both fi­nan­cial and non-fi­nan­cial cor­po­rates re­paid bank­ing loans and re­duced re­liance on bank fi­nanc­ing. House­hold credit growth lifted slightly from 2.8 per­cent year-on-year in May to to 2.9 per­cent year-on-year in June. Growth in mort­gage ad­vances, which makes up 60 per­cent of house­hold credit, re­mained pedes­trian near the 3 per­cent year-on-year mark. Un­se­cured credit growth eased to 4.2 per­cent year-on-year in June from 4.6 per­cent year-onyear in May. Kamilla Ka­plan, an econ­o­mist at In­vestec, said that pri­vate sec­tor credit ex­ten­sion re­mained mod­est in June amid tighter credit cri­te­ria and sub­dued eco­nomic ac­tiv­ity and ex­pected the de­pressed house­hold credit growth to re­main. “Sub­dued house­hold credit growth is ex­pected to be a key re­strain­ing fac­tor on house­hold con­sump­tion ex­pen­di­ture,” Ka­plan said. – Ka­belo Khu­malo

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