July 6 (Bloomberg) -- South African retailers climbed to a record on speculation the central bank may lower the benchmark lending rate this month, boosting consumer’s disposable incomes and retailers’ credit sales.
The 10-member FTSE/JSE Africa General Retailers Index rallied 1.2 percent to 60,358.67 at the close in Johannesburg, the most since at least 1995. The gauge added 5.7 percent in the past five days, the biggest weekly gain in more than eight months. The Foschini Group Ltd., a clothing retailer, advanced 2.2 percent to 138.51 rand. Mr Price Group Ltd., which sells clothing and furniture, rose 1.7 percent to 121 rand.
“The possibility of an interest rate cut is now being debated and that makes these shares even more enticing for foreigners,” Henre Herselman, a derivatives trader at Nedbank Group Ltd.’s BoE Stockbrokers in Johannesburg, said by phone.
Investors have increased bets on a reduction in the benchmark rate, with forward rate agreements starting in six months dropping 51 basis points since the start of April to 5.22 percent, according to data compiled by Bloomberg.
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