BER Weekly
BER Weekly, 1 June 2020
Last updated: Jun 1 2020 9:33AM
While current government attention is focused on mitigating the immediate fallout from the COVID-19 crisis, last week provided some insight into the ANC’s thinking about the reconstruction of the economy post the crisis. Ominously, the governing party
read moreWhile current government attention is focused on mitigating the immediate fallout from the COVID-19 crisis, last week provided some insight into the ANC’s thinking about the reconstruction of the economy post the crisis. Ominously, the governing party foresees an increased role for the state in driving the recovery.
BER Weekly, 25 May 2020
Last updated: May 25 2020 9:08AM
With the domestic data released last week backward looking at the pre-COVID-19 economic performance, attention was focused on the SA Reserve Bank’s (SARB) policy interest rate decision on Thursday. After the SARB delivered in line with expectations (see
read moreWith the domestic data released last week backward looking at the pre-COVID-19 economic performance, attention was focused on the SA Reserve Bank’s (SARB) policy interest rate decision on Thursday. After the SARB delivered in line with expectations (see below), the key event of the week was last night’s address by President Cyril Ramaphosa. The speech outlined the next phase of government’s COVID-19 response. The headline announcement was that from 1 June, the alert level for the entire country will be lowered to Level 3 from Level 4.
BER Weekly, 18 May 2020
Last updated: May 18 2020 9:08AM
Increasingly, a V-shaped global GDP recovery from the COVID-19 crisis seems unlikely. This will weigh on the South African growth outlook, especially as the costs of the strict domestic lockdown mount.
read moreIncreasingly, a V-shaped global GDP recovery from the COVID-19 crisis seems unlikely. This will weigh on the South African growth outlook, especially as the costs of the strict domestic lockdown mount.
BER Weekly, 11 May 2020
Last updated: May 11 2020 9:49AM
The past week was dominated by increasingly robust debate in newspaper and online columns, letters, as well as social media, on the pros and cons of government’s approach to fighting COVID-19. While this was going on, we saw a clear divergence between the
read moreThe past week was dominated by increasingly robust debate in newspaper and online columns, letters, as well as social media, on the pros and cons of government’s approach to fighting COVID-19. While this was going on, we saw a clear divergence between the performance of financial markets and dreadful, albeit not totally unexpected, incoming data on the state of the real economy.
BER Weekly, 4 May 2020
Last updated: May 4 2020 4:36PM
Last week’s domestic headlines were again dominated by the devastating impact that the lockdown restrictions are having on the SA economy. Furthermore, S&P Global Ratings, in an out-of-schedule review, lowered SA’s long-term foreign-currency sovereign credit
read moreLast week’s domestic headlines were again dominated by the devastating impact that the lockdown restrictions are having on the SA economy. Furthermore, S&P Global Ratings, in an out-of-schedule review, lowered SA’s long-term foreign-currency sovereign credit rating to three notches below investment grade.
BER Weekly, 28 April
Last updated: Apr 28 2020 9:22AM
Over the weekend, government released further details on the gradual reopening of the SA economy. Nationally, the country is set to move from Level 5 (the strictest form of lockdown) to Level 4 on Friday. However, aggregated country-wide economic activity
read moreOver the weekend, government released further details on the gradual reopening of the SA economy. Nationally, the country is set to move from Level 5 (the strictest form of lockdown) to Level 4 on Friday. However, aggregated country-wide economic activity will remain constrained for some time to come. With a steeper GDP decline in Q2 and less normalising in Q3, a decline of 9%+ in 2020 GDP seems more likely than the already dismal 7% we projected before.
BER Weekly, 20 April 2020
Last updated: Apr 20 2020 11:11AM
In this week’s edition, we review the latest Chinese data releases for 2020Q1, and in particular what (if anything) this tells us about how the SA recovery from COVID-19 may progress. We also look ahead to a likely (overdue) SA fiscal support package expected
read moreIn this week’s edition, we review the latest Chinese data releases for 2020Q1, and in particular what (if anything) this tells us about how the SA recovery from COVID-19 may progress. We also look ahead to a likely (overdue) SA fiscal support package expected to be announced this week. The focus is mainly on the fiscal implications of this, including the options to fund what will be a substantial budget deficit in 2020/21.
BER Weekly, 14 April 2020
Last updated: Apr 14 2020 8:38AM
Increasingly, it is becoming clear that a return to normality without any restrictions on movement and without social distancing is not weeks away, but rather months. We probably need to get past the winter months first. Therefore, despite already forecasting
read moreIncreasingly, it is becoming clear that a return to normality without any restrictions on movement and without social distancing is not weeks away, but rather months. We probably need to get past the winter months first. Therefore, despite already forecasting a historic GDP decline of 7% in 2020, the risks to our latest forecast remain firmly on the downside.
BER Weekly, 6 April 2020
Last updated: Apr 6 2020 10:16AM
The severe economic fallout from COVID-19 restrictions continued last week. One way to think about this is that SA is experiencing a triple sudden stop: A massive decline in global demand for our exports, a lockdown-induced plunge in domestic production (and
read moreThe severe economic fallout from COVID-19 restrictions continued last week. One way to think about this is that SA is experiencing a triple sudden stop: A massive decline in global demand for our exports, a lockdown-induced plunge in domestic production (and demand), as well as a steep decline in foreign capital inflows to SA. One of these sudden stops at a time would be bad enough, three at the same time are both rare and particularly damaging.
BER Weekly, 30 March 2020
Last updated: Mar 30 2020 11:29AM
Late Friday night, Moody’s downgraded SA’s foreign and local currency sovereign credit rating to Ba1 – one notch below investment grade – following a scheduled ratings review. Tragically, SA also recorded its first COVID-19 deaths and cases surged to over 1
read moreLate Friday night, Moody’s downgraded SA’s foreign and local currency sovereign credit rating to Ba1 – one notch below investment grade – following a scheduled ratings review. Tragically, SA also recorded its first COVID-19 deaths and cases surged to over 1 200 during the week.In financial markets, the SA Reserve Bank (SARB) announced it would start buying government bonds in the secondary market (i.e. from banks, asset managers, etc.) across the yield curve and implemented other measures in an attempt to “provide liquidity into the market, to stabilise markets and to ensure their orderly functioning”.