Credit extension to the private sector (PSCE) grew at a rate of 8.51 percent year-on-year in March from 11.05 percent in February, the South African Reserve Bank (SARB) said on Thursday.

The rate of growth of South Africa's broad M3 money supply measure rose by 10.58 percent in the year to end-March from 13.17 in the year to end-February.

The rate of growth in credit extension was expected to have increased at 9.2 percent year-on-year, according to I-Net Bridge's Econometer.

South Africa's broad M3 money supply aggregate growth rate, meanwhile, was expected to have increased at 11.9 percent y/y.

Forecasts among the economists surveyed for PSCE ranged from 7.4 percent to 10.4 percent, while the range of forecasts for M3 was from 8.2 percent to 12.8 percent at the top of the range.

PSCE was at 22.6 percent a year ago, while M3 was at 21.1 percent, both providing a statistical high base.

This is what leading economists had to say about today's data:

Dennis Dykes, Nedbank:

"The credit number is good, but it depends on which way you look at it. It has come off very strongly, which is good for interest rates, but it also suggests the economy is slowing pretty rapidly. It is a bit of a clincher for the 100 basis points rate cut today, I feel. Credit numbers are a very good indicator of what is happening in the underlying economy. One or two disappointments in terms of inflation in the short term shouldn't affect things as they have to look 12 months out on inflation."

Doret Els, Efficient Group:

"It looks very good on both the money supply and credit fronts. After that inflation figure yesterday that wasn't so positive, this is definitely good news for the rate cut."

Shireen Darmalingam, Standard Bank:

"Credit extended to the private sector is expected to slow further as the year progresses. However, the pace of the slowdown is likely to be more subdued than we have become accustomed to over the past few months. Consumers are wary of their financial positions as accumulated debt is still constraining spending. Consumers are thus likely to resume spending only once stronger economic fundamentals become entrenched. The short-term outlook for the economy continues to be strained; however, an improved inflation profile with an easing in monetary policy in the coming months may provide some reprieve as the year progresses."