Wednesday October 18 2017
South Africa September Inflation Rate Stronger than Expected
Statistics South Africa | Joana Ferreira | joana.ferreira@tradingeconomics.com

South Africa's consumer price inflation rose to 5.1 percent year-on-year in September 2017 from 4.8 percent in the previous month. The reading came in above market expectations of 4.9 percent, mainly boosted by higher prices of housing, transport and miscellaneous goods and services.

Year-on-year, prices rose faster for: Housing and utilities (4.9 percent from 4.5 percent in August), mainly boosted by cost of actual rentals for housing (5.7 percent from 5 percent) and that of owners equivalent rent (5.4 percent from 4.9 percent); transport (5.6 percent from 3.9 percent), due to higher cost of fuel (12.2 percent compared to 5.7 percent) and private transport operation (10.2 percent from 5.2 percent); miscellaneous goods and services (7.6 percent from 7.5 percent); alcoholic beverages and tobacco (4.7 percent from 4.3 percent); household contents and equipment (2.1 percent from 2 percent); and health (7.2 percent from 7 percent). Meanwhile, inflation eased for: Food and non-alcoholic beverages (5.5 percent from 5.7 percent in August); clothing and footwear (2.3 percent from 2.8 percent); recreation and culture (2.2 percent from 2.4 percent); and restaurants and hotels (3.4 percent from 4.2 percent). Prices of communication continued to fall (-1.4 percent from -1.3 percent in August).

Annual core inflation rate, which excludes cost of food, non-alcoholic beverages, fuel and energy stood at 4.6 percent, unchanged from the previous month's five-year low and above market consensus of 4.5 percent.

On a monthly basis, consumer prices increased 0.5 percent, beating expectations of 0.3 percent. 




Friday September 29 2017
South Africa Trade Surplus Narrows in August
South African Revenue Service |Luisa Carvalho | luisa.carvalho@tradingeconomics.com

South Africa trade surplus decreased to ZAR 5.94 billion in August of 2017 from an upwardly revised 9.33 billion surplus in July, but beating market expectations of a ZAR 3.2 billion surplus. Exports increased 11 percent while imports advanced at a faster 16.3 percent. Considering the January to August period, exports increased 5.8 percent and imports decreased 2.1 percent, shifting the country's trade balance into a ZAR 43.5 billion surplus from a ZAR 13.7 billion gap in the same period of 2016.

Compared with the previous month, exports increased to ZAR 103.4 billion from ZAR 93.1 billion, led by higher shipments of mineral products (21 percent); precious metals and stones (20 percent); base metals (12 percent); machinery and electronics (12 percent) while those of vehicles and transport equipment fell 17 percent. Major destinations for sales were China (9.9 percent); the US (8.1 percent); Germany (6.8 percent); Japan (4.7 percent) and Botswana (4.6 percent).

Imports advanced to ZAR 97.4 billion from ZAR 83.8 billion, due to higher purchases of mineral products (65 percent); prepared foodstuffs (36 percent); textiles (27 percent); original equipment components (29 percent) and machinery and electronics (11 percent). Imports came mostly from China (21.3 percent of total imports); Germany (14.1 percent); the US (7.8 percent); India (5.6 percent) and Saudi Arabia (5.2 percent).

Excluding trade with neighboring Botswana, Lesotho, Namibia and Swaziland, the country posted a trade deficit of ZAR 1.9 billion in August compared to a ZAR 2.6 billion surplus in July.




Thursday September 21 2017
South Africa Leaves Key Rate at 6.75%
SARB | Joana Taborda | joana.taborda@tradingeconomics.com

The South African Reserve Bank unexpectedly left is benchmark repo rate steady at 6.75 percent on September 21st 2017, following a 25bps cut in July, mentioning economic uncertainties. Markets were expecting a 25bps cut. However, policymakers left the door open for further loosening in November, saying it would be appropriate to reassess the data and the balance of risks at the next meeting.

Excerpts from the statement by Governor Lesetja Kganyago:

The Bank’s forecast for headline CPI inflation is unchanged at an annual average of 5.3% in 2017, and revised up by 0.1 percentage point to 5.0% and 5.3% in 2018 and 2019. A lower turning point of 4.6% is still expected in the first quarter of 2018. The same pattern is observed in the forecast for core inflation which is unchanged at 4.8% for 2017, but adjusted up to 4.9% and 5.0% for the next two years. 

The main drivers of these changes are a lower repurchase rate, a less appreciated exchange rate assumption, a slightly narrower output gap and a marginal adjustment to the food price forecast as meat prices continue to surprise on the upside. 

The domestic economic growth outlook remains constrained despite the higher-than-expected growth outcome of 2.5% in the second quarter of this year. This broad-based improvement, while welcome, is not expected to have a significant impact on the annual growth outcome. The Bank’s forecast for GDP growth for 2017 has been revised up marginally from 0.5% to 0.6%, while the forecasts for 2018 and 2019 have remained unchanged at 1.2% and 1.5%. 

The rand remains a key upside risk to the inflation outlook. Furthermore, some of the event risks, particularly those of a political nature, are now more imminent but with no greater degree of clarity regarding the outcome. The prospect of a further ratings downgrade persists, particularly given the increased fiscal challenges and political uncertainty. The narrower current account deficit and the global environment remain supportive of the rand. 

Although household consumption expenditure rebounded strongly in the second quarter, the MPC does not view this as indicative of the longer-term trend of expenditure, which is expected to remain constrained. The second quarter growth outcome, while positive, does not change our growth forecast significantly, and the outlook remains weak. The MPC assesses the risks to the revised growth forecast to be slightly on the downside. In light of these developments and the deteriorating assessment of the balance of the risks, the MPC has decided to keep the repurchase rate unchanged at 6.75% per annum. Three members preferred an unchanged stance and three members preferred a 25 basis point reduction. Ultimately the committee decided to keep the rate unchanged.

Given the heightened uncertainties in the economy, the MPC felt it would be appropriate to maintain the current monetary policy stance at this stage, and reassess the data and the balance of risks at the next meeting.




Wednesday September 20 2017
South Africa Inflation Rate Edges Up to 4.8% in August
Statistics South Africa | Joana Taborda | joana.taborda@tradingeconomics.com

Inflation rate in South Africa increased to 4.8 percent from 4.6 percent in July which was the lowest since September of 2015 but below market expectations of 4.9 percent. Transport prices rose faster while food cost increased the least since November of 2015. Also core inflation fell to 4.6 percent, the lowest in five years.

Year-on-year, prices rose faster for transport (3.9 percent compared to 1 percent in July) as fuel cost recovered (5.7 percent compared to -3.6 percent) and alcoholic beverages and tobacco (4.3 percent compared to 3.3 percent). On the other hand, a slowdown was seen in cost of food and non-alcoholic beverages (5.7 percent compared to 6.8 percent); miscellaneous goods and services (7.5 percent compared to 7.6 percent) and recreation and culture (2.4 percent compared to 3.2 percent). Inflation was steady for housing and utilites (4.5 percent) and education (7 percent). 

Annual core inflation rate, which excludes cost of food, non-alcoholic beverages, petrol and energy fell to 4.6 percent, the lowest rate since August of 2012 compared to 4.7 percent in July.

On a monthly basis, consumer prices edged up 0.1 percent, following a 0.3 percent rise in July. Cost increased for alcoholic beverages and tobacco (1.2 percent) and transport (0.5 percent) but fell for food (-0.2 percent). 


Tuesday September 05 2017
South Africa Annual GDP Growth at 2-Year High in Q2
Statistics South Africa | Joana Taborda | joana.taborda@tradingeconomics.com

The South African economy advanced 1.1 percent year-on-year in the second quarter of 2017, above 1 percent in the previous period and beating market expectations of 0.4 percent. It is the strongest annual growth rate in two years.

Agriculture, forestry and fishing jumped 28.9 percent (11.4 percent in Q1), recovering from drought. Utilities grew 0.5 percent rebounding from 1.6 percent contraction in Q1. Alos, faster expanison was recorded for construction (0.4 percent compared to 0.2 percent in Q1); finance, real estate and business services (1.1 percent compared to 0.9 percent) and personal services (0.9 percent compared to 0.8 percent). 

On the other hand, the growth slowed in mining and quarrying (2.1 percent compared to 6.8 percent in Q1) and transport and communication (1.2 percent compared to 1.5 percent) and further contraction was recorded in manufacturing (-2 percent compared to -0.9 percent) and trade (-1.2 percent compared to -1 percent).  

On a quarterly basis, the GDP expanded an annualized 2.5 percent, ending two quarters of contraction and beating market expectations of a 2.1 percent rise. It is the highest growth rate in a year with agriculture, forestry and fishing making the largest upward contribution, boosed mainly by higher production of field crops and horticultural products.




Tuesday September 05 2017
South Africa GDP Growth Beats Expectations in Q2
Statistics South Africa | Joana Taborda | joana.taborda@tradingeconomics.com

The South African economy expanded an annualized 2.5 percent on quarter in the three months to June of 2017, ending two quarters of contraction and beating market expectations of a 2.1 percent rise. It is the highest growth rate in a year with agriculture, forestry and fishing making the largest upward contribution, namely field crops and horticultural products.

Agriculture, forestry and fishing jumped 33.6 percent, higher than a 23.1 percent increase in Q1. Additional upward contributions came from finance, real estate and business services (2.5 percent, recovering from a 1.2 percent decline in Q1); mining and quarrying (3.9 percent compared to 13.1 percent in Q1), namely coal, gold, manganese ore and iron ore and other’ mining and quarrying including diamonds; manufacturing (1.5 percent to -3.7 percent in Q1), mainly food and beverages, motor vehicles, parts and accessories and other transport equipment; electricity, gas and water supply (8.8 percent compared to -4.8 percent); transport and communication (2.2 percent compared to -1.6 percent in Q1); trade (0.6 percent compared to -5.9 percent in Q1) and personal services (1.1 percent compared to -0.1 percent in Q1).

In contrast, general government services decreased by 0.6 percent (-0.7 percent in Q1) and construction went down 0.5 percent (-0.8 percent in Q1), with falls seen in both residential and non-residential buildings.

Year-on-year, the economy advanced 1.1 percent, above 1 percent in the previous quarter and the highest annual growth rate in two years. Considering the first half of 2017, the economy advanced 1.1 percent. 




Thursday August 31 2017
South Africa Trade Surplus Narrows in July
South African Revenue Service |Luisa Carvalho | luisa.carvalho@tradingeconomics.com

South Africa trade surplus decreased to ZAR 8.99 billion in July of 2017 from a downwardly revised ZAR 10.56 billion surplus in June, beating market expectations of a ZAR 5.8 billion surplus. Exports fell 8.7 percent and imports declined at a slower 8 percent. Considering the January to July period, exports rose 4.4 percent and imports tumbled 2.2 percent, shifting the country's trade balance into a ZAR 36.6 billion surplus from a ZAR 4.703 billion gap in the same period of 2016.

Compared with the previous month, exports declined to ZAR 93.09 billion from ZAR 102.02 billion, mainly due to lower shipments of precious metals and stones(-21 percent); base metals (-12 percent); mineral products (-5 percent); machinery and electronics (-5 percent) and wood and wood articles (-30 percent). Major destinations for exports were China (8.7 percent of total exports), Germany (7.8 percent), the US (7.6 percent), Japan (5.3 percent) and Namibia (4.3 percent).

Imports fell to ZAR 84.11 billion from ZAR 91.46 billion, due to lower purchases of mineral products (-27 percent); original equipment components (-17 percent); base metals (-18 percent); vehicles and transport equipment (-11 percent) and machinery and electronics (-5 percent). Imports came mainly from China (18 percent of total imports), Germany (11.9 percent), the US (7 percent), India (5.4 percent) and Japan (3.6 percent).

Excluding trade with neighboring Botswana, Lesotho, Namibia and Swaziland, the country posted a trade surplus of ZAR 2.3 billion in July.


Wednesday August 23 2017
South Africa Inflation Slows to Near 2-Year Low of 4.6%
Statistics South Africa | Joana Taborda | joana.taborda@tradingeconomics.com

Consumer prices in South Africa increased 4.6 percent year-on-year in July of 2017, below a 5.1 percent rise in June and in line with market expectations. It is the lowest inflation rate since September of 2015, mainly due to a slowdown in cost of food and electricity and a fall in fuel prices.

Year-on-year, prices rose at a slower pace for: food and non-alcoholic beverages (6.8 percent compared to 6.9 percent in June); housing and utilities (4.5 percent compared to 5.7 percent), namely electricity and other fuels (2.1 percent compared to 7.4 percent); transport (1 percent compared to 3.3 percent), mainly due to a fall in fuel prices (-3.6 percent compared to +2 percent); household contents and services (2.3 percent compared to 2.4 percent) and recreation and culture (3.2 percent compared to 3.3 percent)

On the other hand, inflation rose for miscellaneous goods and services (7.6 percent compared to 7.1 percent) and was steady for alcoholic beverages and tobacco (3.3 percent); restaurants and hotels (4.1 percent); education (7 percent) and health (7 percent). 

Annual core inflation rate, which excludes cost of food, non-alcoholic beverages, petrol and energy fell to 4.7 percent from 4.8 percent, the lowest rate since January of 2013.

On a monthly basis, consumer prices went up 0.3 percent, following a 0.2 percent rise in June. Cost increased for food and non-alcoholic beverages (0.3 percent); housing and utilities (1.2 percent) and miscellaneous goods and services (0.5 percent) but fell 1.5 percent for transport.


Monday August 07 2017
South Africa Jobless Rate Unchanged at 27.7% in Q2
Statistics South Africa | Joana Ferreira | joana.ferreira@tradingeconomics.com

South Africa's unemployment rate came in at 27.7 percent in the second quarter of 2017, unchanged from the previous period's 13-year high. The number of unemployed fell by 37 thousand to 6.18 million while the number of employed declined by 113 thousand to 16.10 million.

The number of unemployed persons decreased by 37 thousand to 6.18 million from 6.21 million in the first quarter. Employment dropped by 113 thousand to 16.10 million from 16.21 million in the previous period. Job losses occurred in the formal non-agricultural sector (-144 thousand), in agriculture (-40 thousand), and in private households (-8 thousand) but gains were recorded in the informal sector (80 thousand). 

The labour force declined by 150 thousand to 22.28 million from 22.43 million in Q1; and those detached from it rose by 306 thousand to 14.94 million from 14.63 million.

The expanded definition of unemployment, which includes people who have stopped looking for work, rose slightly to 36.6 percent in the second quarter, from 36.4 percent in the previous period.

A year earlier, the jobless rate was recorded at at 26.6 percent. 




Monday July 31 2017
South Africa Trade Surplus Higher than Expected
South African Revenue Service | Joana Taborda | joana.taborda@tradingeconomics.com

South Africa trade surplus increased to ZAR 10.67 billion in June of 2017 from a downwardly revised ZAR 7.22 billion surplus in May, beating market expectations of a ZAR 8.4 billion surplus. Imports slumped 4.2 percent while exports declined at a slower 0.6 percent. Considering the first six months of the year, exports jumped 4.7 percent while imports went down 1.4 percent, shifting the country's trade balance into a ZAR 27.67 billion surplus from a ZAR 5.042 billion gap in the same period of 2016.

Compared with the previous month, imports declined to ZAR 91.46 billion from ZAR 95.51 billion, mainly due to lower purchases of mineral products (-31 percent); machinery and electronics (-2 percent) and textiles (-11 percent). On the other hand, imports rose for vegetables (27 percent) and vehicles and transport equipment (21 percent). 

Exports fell to ZAR 102.14 billion from ZAR 102.73 billion, due to lower shipments of mineral products (-16 percent); base metals (-6 percent);  chemical products (-8 percent); wood pulp and paper (-16 percent); live animals (-14 percent); machinery and electronics (-2 percent) and plastic and rubber (-6 percent). In contrast, sales went up for precious metals and stones (11 percent), vegetables (33 percent) and vehicles and transport equipment (18 percent). 

Excluding trade with neighboring Botswana, Lesotho, Namibia and Swaziland, the country'd trade gap widened to ZAR 0.549 billion from a ZAR 0.378 billion gap in May. However, the trade deficit fell to ZAR 18.19 billion in the forst six months of 2017 from a ZAR 56.41 billion shortfall in the same period of 2016.