Home loans go up in defiance of rate increases
Household borrowing defied the central bank's interest rate hikes again in August's money supply data, but the growth was hopefully too slow to prompt the Reserve Bank's Monetary Policy Committee (MPC) to vote the repo rate up on Thursday next week.
Household borrowing edged up 0,5percent to over R978billion, accounting for more than half of the R1,8trillion total loans and advances to the private sector. An expected slump in home loans failed to appear, with mortgages growing one percent to R934billion.
Continuing a trend since the introduction of the National Credit Act last year, leasing got less popular with people switching to paying for cars and furniture in instalments.
Total leasing finance has shrunk from more than R61billion a year ago to R50billion in August while instalment finance in that time has grown from R168billion to nearly R200billion.
The consensus among economists is the Reserve Bank will hold its repo rate at 12percent for the remainder of this year even though it is now loaning to commercial banks at a negative real interest rate.
The consumer price index excluding mortgages on which interest rate decisions are based hit 13,6percent in August, and economists are divided on what September's figure will be.