South Africa vehicle sales grew at the fastest pace in six months in January as the lowest borrowing costs in more than 30 years spurred demand.
Purchases rose 14 percent from a year earlier to 55,007, the Pretoria-based National Association of Automobile Manufacturers said in an e-mailed statement today. Sales expanded 1.8 percent in December and 18.3 percent in July.
“Despite indications of slower growth in the economy, the performance of the South African automotive sector continued to surprise on the upside,” the association said. Inflation pressures and higher vehicle prices because of a weaker rand may “result in some moderation in the rate of growth in sales.”
The Reserve Bank kept the repurchase rate at 5 percent last month after a surprise cut in July to help stimulate the economy. Consumer spending, which makes up about two-thirds of expenditure in the economy, has come under pressure as inflation remains near the top of the central bank’s 3 percent to 6 percent target. The bank is forecasting economic growth of 2.6 percent this year, compared with an estimated 2.5 percent in 2012.
A weaker rand and increased risk sentiment prompted consumers to buy vehicles before dealers raised prices, the association said. The rand has dropped 4.7 percent against the dollar this year and was trading as low as 8.8890 today.
Passenger-car sales increased 12 percent to 39,738 in January, while vehicle exports rose 50 percent to 17,399.
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