Recent cuts in interest rates appear to have had the desired effect on South African consumers, with the latest survey on consumer confidence showing a rebound in the first quarter.

The FNB/BER consumer confidence index, published today, revealed an increase in the first quarter to +1 from minus 4 in the fourth quarter of last year.

The rebound followed the decision by the Reserve Bank to lower interest rates twice over the period, alongside a slower pace of inflation and a decline in fuel prices.

“The positive impact of the interest rate cuts, lower petrol price and national budget fully countered the adverse impact of the job losses and fall in house prices,” said FNB’s chief economist Cees Bruggemans.