BER Weekly
BER Weekly, 22 September 2017
Last updated: Sep 22 2017 12:32PM
In the domestic section we unpack the latest decision by Monetary Policy Committee (MPC) of the South African Reserve Bank (SARB). Against expectations for a cut, the MPC decided to keep the policy interest rate unchanged. Additionally, we look at the latest
read moreIn the domestic section we unpack the latest decision by Monetary Policy Committee (MPC) of the South African Reserve Bank (SARB). Against expectations for a cut, the MPC decided to keep the policy interest rate unchanged. Additionally, we look at the latest consumer inflation numbers from Statistics South Africa (Stats SA), which shows that August CPI inflation remained subdued. In the international section we discuss the latest interest rate decisions from the US and Japan.
BER Weekly, 18 September 2017
Last updated: Sep 18 2017 11:28AM
Data reported on the domestic economy last week covered the current account balance for Q2, as well as retail and wholesale sales in July. Accordingly, SA registered its third consecutive trade surplus in the second quarter. Despite this improvement on the
read moreData reported on the domestic economy last week covered the current account balance for Q2, as well as retail and wholesale sales in July. Accordingly, SA registered its third consecutive trade surplus in the second quarter. Despite this improvement on the back of higher commodity prices, transfer payments to the Southern African Customs Union (SACU) resulted in a wider gap on the current account. Meanwhile, the retail and wholesale data gave mixed signals at the start of the third quarter.
Internationally, the Bank of England announced no change to its current accommodative monetary policy, though it indicated this stance could soon change. Markets interpreted these comments as hawkish, and as a result the pound gained some value in currency markets. Meanwhile, industrial production data for August was down in the US on the back of Hurricane Harvey, while in the Eurozone and China annual production growth remained on a strong footing.
BER Weekly, 11 September 2017
Last updated: Sep 11 2017 11:56AM
The quarter-on-quarter (q-o-q) GDP growth rate in the second quarter turned out higher than most analysts expected. The implication is that SA exited the technical recession that lasted for half a year. Regarding the third quarter, the July figures for
read moreThe quarter-on-quarter (q-o-q) GDP growth rate in the second quarter turned out higher than most analysts expected. The implication is that SA exited the technical recession that lasted for half a year. Regarding the third quarter, the July figures for manufacturing output indicate a continuation of positive GDP growth.
Meanwhile, growth in the world economy is also gaining momentum. The global composite Purchasing Managers’ Index (PMI) ticked up in August and was above the neutral-50 mark for nearly five years. Nonetheless, the European Central Bank (ECB) remains cautious and decided to keep its policy interest rates at accommodative levels. In financial markets, the dollar lost some ground amid fears that hurricanes Irma and Harvey may dent US economic growth, while the oil price also increased on lower US production.
BER Weekly, 04 September 2017
Last updated: Sep 4 2017 12:48PM
In the domestic section we unpack July’s trade balance figures as well as the Purchasing Managers’ Index (PMI) and new vehicle sales data for August. The section also discusses the factory-gate inflation figures for July, which continued along its recent
read moreIn the domestic section we unpack July’s trade balance figures as well as the Purchasing Managers’ Index (PMI) and new vehicle sales data for August. The section also discusses the factory-gate inflation figures for July, which continued along its recent downward trend. In the international section we take a look at the latest US employment and (revised) GDP growth figures, as well as activity indicators out of China. While US job creation slowed in August, overall economic activity remains well supported. Similarly, Chinese activity indicators point to sustained growth in the world’s second largest economy.
BER Weekly, 28 August 2017
Last updated: Aug 28 2017 10:40AM
On the domestic front, Statistics South Africa (Stats SA) released the latest consumer inflation data, as well as a report on poverty trends. The inflation data indicated a continued downward move in price pressures, which will be welcomed by consumers. The
read moreOn the domestic front, Statistics South Africa (Stats SA) released the latest consumer inflation data, as well as a report on poverty trends. The inflation data indicated a continued downward move in price pressures, which will be welcomed by consumers. The poverty report was significantly less positive, showing that poverty is on the rise in South Africa. In the international section, we unpack the latest preliminary Purchasing Managers’ Index (PMI) data for the Eurozone, the US and Japan. The PMI data suggests that growth in the developed economies remained solid in August. The section also briefly refers to the speeches made by US Federal Reserve (Fed) chair Janet Yellen and European Central Bank (ECB) president Mario Draghi at the Jackson Hole symposium.
BER Weekly, 21 August 2017
Last updated: Aug 21 2017 1:37PM
Last week was rather quiet on the domestic data front. The main release was the June retail trade data from Statistics South Africa (Stats SA) which, along with the wholesale trade data, reinforced the view that the SA economy likely exited the technical
read moreLast week was rather quiet on the domestic data front. The main release was the June retail trade data from Statistics South Africa (Stats SA) which, along with the wholesale trade data, reinforced the view that the SA economy likely exited the technical recession in Q2. The improvement in the internal trade data is especially welcome given that the trade sector was the biggest drag on growth in Q1. Internationally, the focus was on monetary policy committee meeting minutes from the US and Eurozone. While both central banks were concerned about lower-than-target inflation, in the Eurozone it is largely due the fears that the euro currency will continue to strengthen against the US dollar.
BER Weekly, 14 August 2017
Last updated: Aug 14 2017 12:15PM
Political developments surrounding the vote on the motion of no confidence in President Jacob Zuma (his eighth since assuming office) dominated local news headlines early last week with, firstly, the announcement that it will be conducted by secret ballot,
read morePolitical developments surrounding the vote on the motion of no confidence in President Jacob Zuma (his eighth since assuming office) dominated local news headlines early last week with, firstly, the announcement that it will be conducted by secret ballot, and secondly, the outcome of the vote. On the domestic data front, manufacturing data for June confirmed that the 2017Q2 performance of this sector was better than in Q1 while growth in mining remained positive, albeit slower than in Q1. However, the softer Absa Purchasing Managers’ Index (PMI) for July suggests renewed pressure on manufacturing output in Q3.
BER Weekly, 07 August 2017
Last updated: Aug 7 2017 11:47AM
In the domestic section, we unpack the latest trade balance statistics from the SA Revenue Service (SARS), labour data for 2017Q2, the ABSA Manufacturing Purchasing Managers’ Index (PMI) and new vehicle sales data. The data releases by and large reflect, and
read moreIn the domestic section, we unpack the latest trade balance statistics from the SA Revenue Service (SARS), labour data for 2017Q2, the ABSA Manufacturing Purchasing Managers’ Index (PMI) and new vehicle sales data. The data releases by and large reflect, and confirm, the weak domestic demand environment. In the international section we discuss GDP data from the Eurozone (EZ), the latest PMI statistics from across the globe and labour data out of the US.
BER Weekly, 31 July 2017
Last updated: Jul 31 2017 10:48AM
It was a quiet week on the domestic data front, with headline producer price inflation the only noteworthy data release. According to Statistics South Africa (Stats SA), producer price inflation slowed sharply in June on the back of moderating food and
read moreIt was a quiet week on the domestic data front, with headline producer price inflation the only noteworthy data release. According to Statistics South Africa (Stats SA), producer price inflation slowed sharply in June on the back of moderating food and beverage price inflation. More on the latest release in the domestic section.
In the international section we focus on the latest policy announcement by the US Federal Reserve (Fed) and GDP data from several key developed economies.
BER Weekly, 24 July 2017
Last updated: Jul 24 2017 11:20AM
Most analysts were surprised last week when the policy makers at the SA Reserve Bank (SARB) announced a cut to the repo rate. The decision was motivated by the downward trend in both inflation and economic growth. Besides the interest rate decision, domestic
read moreMost analysts were surprised last week when the policy makers at the SA Reserve Bank (SARB) announced a cut to the repo rate. The decision was motivated by the downward trend in both inflation and economic growth. Besides the interest rate decision, domestic consumer-related figures were a mixed bag as retail sales grew in May while wholesale trade sales contracted.
Meanwhile, on the international scene, monetary policy decisions were also on the agenda last week. Both the European Central Bank (ECB) and the Bank of Japan (BoJ) held their key policy rates steady. ECB president Mario Draghi attempted to steer away from strong signals regarding the unwinding of the ECB asset purchase programme. Nonetheless, markets reacted significantly as the euro surged against an embattled US dollar, which weakened to its lowest level in 12 months. This week markets will keep an eye on the interest rate decision of the US Federal Reserve (Fed) on Wednesday.