ECONOMIC WEEK AHEAD: Data expected to show uptick in vehicle sales
Reserve Bank’s surprise July interest rate cut will show in positive vehicle sales
The Reserve Bank’s surprise July interest rate cut is bearing fruit and will be an underlying factor in positive vehicle sales expected this week. After a dismal performance in 2016 as the economy battled the effects of a crippling drought, vehicle sales have expanded year on year over the past three months. Mamello Matikinca, FNB senior economist, said the September print for vehicle sales to be released on Monday was expected to continue on a positive trend. "The 25-basis-point cut in July, as well as a very weak base, should lend support to the numbers for the balance of the year," she said. This may be underpinned by a modest recovery in household appetite for credit. Data published by the Bank last week showed a 3.4% rise in household credit extension in August from 3.3% in July. Corporate sector extension improved slightly. This supports the positive reading of the Bank’s leading business cycle indicator last week on the back of an uptick in building plans passed, business con...
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