Phumuza Macanda for the Mail and Guardian reports:

Demand for credit from South Africa’s private sector fell more than expected in April, reflecting companies’ reluctance to borrow further in an uncertain economic environment.

Companies have mostly given a cautious outlook for this year and sales remain under pressure as demand in Africa’s biggest economy continues to be weak.

The central bank said on Monday credit demand fell by 0,86% year-on-year in April — the eighth monthly decline in a row — more than the 0,4% fall seen in a Reuters poll last week. Demand had contracted by 0,69% in March.

“Weakness comes from the corporate sector and we expect that to continue while domestic demand recovers quite slowly,” said Ian Marsberg, macro strategist at Absa Capital.

“The slow uptick on the household side doesn’t really change our view on interest rates which we expect to remain at current levels till the first half of next year.”

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