Credit growth springs a positive surprise
Growth in credit granted to the private sector accelerated more than expected in June, an encouraging sign from a market that has been relatively subdued since the start of 2018.
Private sector credit extension (PSCE) grew at an annual rate of 5.68% in June, from 4.54% in May, Reserve Bank data showed on Monday.
Trading Economics had anticipated PSCE growth of 4.7%. Investec had put it at 4.8%.
The main restraining influence on PSCE growth has been the corporate sector, Investec economist Lora Hodes said on Friday ahead of the data release.
"The weak economic growth backdrop, along with persistently depressed business confidence and declining investment rates, have contributed to the dampened corporate demand for credit."
M3 money supply, the Bank’s broadest measure of how much money is circulating in the economy, grew 5.77% year on year in June, from 5.73% in May, Monday’s data showed.
When money supply increases, it typically increases the availability of loans. The higher the money supply growth, the higher the growth in available funds.