Business confidence edged higher to a new peak last month, despite a further reserve bank interest rate hike, and the trend is likely to continue this year, a survey showed yesterday.

Business confidence edged higher to a new peak last month, despite a further reserve bank interest rate hike, and the trend is likely to continue this year, a survey showed yesterday.

The South African Chamber of Business' (Sacob) business confidence index rose to 103,5 index points from 103,2 in November and 99,5 in October, its poll showed.

The boost in confidence comes despite the country's central bank raising its repo rate by 200 basis points to 9percent last year in an effort to curb inflationary pressures. The latest half percentage point hike came last month.

Sacob said confidence in the business arena was largely driven by solid economic growth, which it expected to be 4percent this year.

"It might be lower than the estimated 4,4percent last year, but if based on high real fixed investment growth and a more sustainable rate of increase in real expenditure, it could lay a sound basis for higher future growth," it said. - Reuters