Next month's decision on interest rates will be a tough one for the Reserve Bank's monetary policy committee.

With inflation less of a concern now, more calls can be expected for a rate cut.

Civil debt figures released by Stats SA on Thursday show consumers are still highly indebted, and are experiencing a high degree of financial vulnerability.

The figures show the private sector is still struggling with debt repayments, with individuals making up 92% of the judgments and business enterprises just 8%.

These figures come after Stats SA reported that the number of civil judgments recorded for debt in April had increased 11.6% year--on-year, bucking the single-digit growth trend evident earlier this year

"The risk is that with civil judgments and summonses issued still positive and rising, households could see further instability on their balance sheets, unless economic recovery, employment creation and real income growth deepen sustainably," said Investec chief economist Annabel Bishop.

And even though retail sales to April were shown to have grown by 3.2% from 2.7% - it was not long ago that 14 negative readings in a row were recorded - Bishop is still expecting the weaker backdrop provided by other statistics to lead to a 50 basis-point interest rate cut this year.

Wholesale trade sales at constant (2000) prices for April were down 1% year-on-year, according to another statistics release this week, adding credence to this thinking.

Bishop said that if the monetary policy committee did not cut rates by 50 basis points next month then she expected that it probably would at its meeting in September.

The National Credit Regulator's latest credit bureau monitor shows that 45.3% of SA's 18.1million credit-active consumers have impaired credit records.

Impaired accounts are those classified as three or more payments in arrears, or having an adverse listing (slow paying, absconded, default, handed over, written off) or reflecting a judgment or administrative order.

The trend is clearly a concern as more individuals struggle after a rise in retrenchments during the recession and the unemployment rate grows to just more than 25%.

Total job losses last year numbered 870000 as the country entered its first recession in 17 years. The problem now is that many employers retrenched or suspended new appointments, and they are not rehiring as fast as would be expected now that the recession is over.

As this feeds into the real economy, consumption patterns also suffer, but expanded unemployment (including those labelled as discouraged in the headline figure and who had not sought work four weeks prior to the quarter) paints an even worse picture.

Nearly a third of South Africans are unemployed on this basis at 32.5% from 31.1%, as it brings into the fold discouraged work seekers in mainly rural areas.

From this perspective, not even a statistical uptick in retail sales can be viewed as silencing talk of another rate cut.

Some investors in interest-rate derivatives have cottoned on to the potential and are pricing in the possibility of a cut by the third quarter of the year.