South Africa Leading Index Edges Down

The composite leading business cycle indicator in South Africa edged down to 0.5% month-over-month in February 2026, from an upwardly revised 0.6% in the previous month. Growth in seven of the ten available component series outweighed declines in the remaining three. The strongest positive contributions came from a rise in the number of residential building plans approved and an increase in the country’s US-dollar denominated export commodity price index. However, these gains were partly offset by a decline in the volume of domestic manufacturing orders and a slowdown in the six-month smoothed growth rate of job advertisements. At the same time, the composite coincident business cycle indicator increased by 0.3% in January 2026, supported by higher industrial production and a rise in the real value of wholesale, retail, and motor trade sales. In contrast, the composite lagging business cycle indicator fell by 0.3% in January.

The composite leading business cycle indicator in South Africa increased by 0.4% month-on-month in January 2026, rebounding from a downwardly revised 0.4% fall in December. Growth in five of the indicator’s ten available components outweighed declines in the remaining five, with the largest positive contributors coming from the country’s US-dollar export commodity price index and a rebound in the RMB/BER Business Confidence Index. Conversely, the largest drags came from a slowdown in the six-month growth rate of new passenger vehicle sales and a decline in domestic manufacturing orders. Meanwhile, the composite coincident business cycle indicator fell 0.2% in December 2025, reflecting weaker industrial production and a drop in the real value of wholesale, retail, and motor trade sales. The composite lagging indicator edged up 0.1% in December.

The composite leading business cycle indicator in South Africa decreased by 1% month-on-month in December 2025, reversing a 1.4% increase in the previous month. This marked the first decline since September, as decreases in five of the seven available component time series outweighed increases in South Africa’s US-dollar denominated export commodity price index and an acceleration in the six-month smoothed growth rate in the number of new passenger vehicles sold. The main negative contributors were a deceleration in the six-month smoothed growth rate in the real M1 money supply and a decrease in the number of residential building plans approved. Meanwhile, the composite coincident indicator fell by 0.2% in December, slipping from a 0.3% rise in the prior period, due to decreases in the industrial production index and the utilisation of production capacity in the manufacturing sector. The lagging indicator declined by 0.4% in the same month.