South Africa Business Cycle Index Rises Most in Nearly 5 Years

The composite leading business cycle indicator in South Africa climbed by 2.4% month-on-month in March 2026, following an upwardly revised 0.6% increase in the previous month. The latest figure marked the strongest expansion since May 2021, as six of the seven" available components contributed positively, led by an acceleration in the six-month smoothed growth rate in the real M1 money supply and a widening of the interest rate spread. Meanwhile, the main negative contributions came from a deterioration in the composite leading business cycle indicator for South Africa’s major trading-partner countries. The composite coincident indicator declined by 0.1% in February 2026, driven by decrease in the utilization of production capacity in the manufacturing sector and industrial production index. In contrast, the lagging indicator edged up by 0.6% in February.

The composite leading business cycle indicator in South Africa grew 0.5% month-over-month in February 2026, easing 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.