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Total banking sector credit decreased 1,1 percent in January 2016 to $5,47 billion although year on year there was a growth of 28,7 percent.

According to the latest monthly report from the Reserve Bank of Zimbabwe (for January) credit to the private sector registered a 4,9 percent annual growth in January from 0,9 percent in December 2015.

Month-on-month, credit to the private sector, however, declined by 0,8 percent to $3,8 billion January 2016.

The sectoral distribution of private sector credit was skewed towards agriculture (21,1 percent); manufacturing (17,5 percent); services including tourism (15percent); distribution (13,9 percent); mining (5,8 percent); financial organisations and investments, (3,0 percent); transport and communications (2,8 percent); and construction (1,3 percent).

Credit to households stood at 19,6 percent in December 2015 and this reflects the persistence dominance of consumptive borrowing in the economy.

According to the report, private sector credit was used in asset purchases, 41,1 percent; inventory build -up, 35,2 percent; consumer durables, 14,2 percent; and vehicle purchases, 3,3 percent. Funds utilised for capital development remained low at 4,9 percent of total loans and advances.

Pre and post shipment financing accounted for 1,3 percent of total credit to the private sector.

Net claims on Government were at $1,53 billion which was a slight decrease from $1,56 billion in the previous month (December 15), net claims on public enterprises were at $145,5 million. At the end of January, commercial banks held $981,9 million treasury bills and building societies $76,6 million.

Externally Zimbabwe’s total debt stood at $10,68 billion in December.

Annual growth in money supply stood at 9,6 percent in January, reflecting a 1,4 percentage point increase from 8,2 percent recorded in December 2015.

On a monthly basis, however, the growth in broad money supply declined to — 0,2 percent, from 0,4 percent in December 2015.

In nominal terms, money supply declined to $4,75 billion from $4,76 billion in December 2015.

In line with the usual trends at the beginning of the year, the value of transactions processed through the RTGS system in January 2016 decreased by 19 percent, to $3,39 billion from $4,17 billion recorded in December 2015.

Transaction volumes also registered a decrease of 15percent to 132 260 from 155 044.

The total value of mobile and internet based transactions fell to $556,6 million in from $690,8 million in December. — Wires.