Lending growth picks up, thanks to property and renewable energy
By contrast, household lending growth has slowed — and Investec economist Kamilla Kaplan warns impending tax hikes could make matters worse
Growth in credit extended to the private sector accelerated again in January, thanks to double-digit growth in loans extended to companies. Growth in lending to households slowed. Overall private sector credit extension (PSCE) grew 5.56% in January compared with a year earlier, up from 5.1% growth in December, Reserve Bank data showed on Tuesday. Investec economist Kamilla Kaplan pointed out lending to business grew 10.1% from a year earlier — up from 9.1% in December — while lending to households grew 0.6%, slowing from 0.7% in December. "Modest rates of household credit growth have been a restraining factor on household consumption expenditure," Kaplan said, warning that higher taxes announced by Finance Minister Pravin Gordhan in the budget on February 22 could make the situation worse. In the first three quarters of 2016, Kaplan noted, growth in private consumption had almost halved, to 0.9% from 1.7% a year earlier. The strong growth in corporate lending was mostly due to activ...
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