This report covers the key domestic and international data releases over the past week. The more comprehensive BER Weekly Review (Enhanced Version) includes a detailed discussion on the main economic events and developments over the past week, a summary of upcoming data (the week ahead) and the BER’s forecast for key economic indicators. The full Weekly is only available to BER Essential Insights subscribers (sign up here – it’s only R210/month and you get more benefits) and BER Premium Insights clients.

DOMESTIC DATA

Nomvelo Moima

CONSUMER CONFIDENCE FAILS TO EXTEND RECOVERY IN Q3 

After rebounding sharply in 25Q2, the FNB/BER Consumer Confidence Index (CCI) retreated to -13 in Q3, down from -10 in the previous quarter. This reversal was mostly driven by a slump in middle-income households’ confidence (from -7 to -16). Two out of three CCI sub-indices deteriorated, with only the sub-index tracking the appropriateness of the present time to buy durable goods improving, supported by further easing in the lending rate.  

Looking ahead, the CCI points to retail sales during Q3 still benefitting from some consumer resilience (particularly, at the higher end). However, weak confidence among middle- and low-income households will likely translate into a more notable slowdown in consumer spending over the second half of the year. 

FACTORY GATE INFLATION REACHES A ONE-YEAR HIGH IN AUGUST 

Headline producer price (PPI) inflation for final manufactured goods quickened from 1.5% to 2.1% y-o-y in August. This acceleration was faster than the consensus forecast (1.8%) and our expectations. Food products made the biggest contribution (+1.3%pts). Notably, while the pace of price increases for meat products moderated slightly in August, annual PPI inflation for this food category of 18.5% remains close to the 12-year peak (20.6%) recorded in June. On a monthly basis, PPI rose by 0.3%, after a 0.7% increase in the prior month. 

A SECOND CONSECUTIVE MONTHLY RISE IN THE LEADING BUSINESS CYCLE INDICATOR 

The SARB’s Composite Leading Business Cycle Indicator (LEI) increased by 0.9% m-o-m in July, up from a 0.5% rise in June. On an annual basis, the indicator increased by 1.2% in July, marking the strongest reading in three months. Seven of the ten LEI components showed growth, with the largest positive contributors being an increase in SA's US dollar-denominated export commodity price index and stronger growth in the number of new passenger vehicles sold.   

INTERNATIONAL SECTION

Katrien Smuts

CONSUMER CONFIDENCE IMPROVES IN EUROZONE, BUT CONCERNS PERSIST

Consumer confidence in the Eurozone improved to -14.9 in September, up from -15.5 in August. While still firmly in negative territory, the improvement was better than expected and likely reflects consumer relief at lower interest rates and easing inflation relative to earlier in the year.

In Germany, the GfK consumer confidence index surprised to the upside, rising to -22.3 in September from -23.5 in August. This marked a break in the downward trend observed over recent months. The improvement was driven mainly by better income expectations. However, this has not translated into a stronger willingness to spend, as heightened geopolitical uncertainty continues to weigh on sentiment.

EUROZONE FLASH PMI: SERVICES BOOST OFFSETS MANUFACTURING SLOWDOWN

The Eurozone’s composite flash PMI remained above the neutral 50-mark for the ninth consecutive month, rising to 51.2 in September from 51.0 in August. The improvement was driven by the services sector, which posted its strongest monthly growth so far in 2025. The services PMI rose to 51.4 in September from 50.5 in August. In contrast, the manufacturing output index, while still in expansionary terrain, fell from 52.5 in August to 50.7 in September. The slowdown in manufacturing activity was likely influenced by recent political developments in France, which dampened productivity. Nonetheless, production in Germany and other parts of the Eurozone continued to expand, albeit at a moderating pace.

US FLASH PMI SOFTENS AMID TARIFF-RELATED PRICE PRESSURES

Flash PMI readings for the US declined to 53.6 in September, from 54.6 in August. Although the composite index remains in expansionary territory, the slowdown reflects softer demand growth. Both the services and manufacturing components weakened in September, with the latter seeing a more pronounced decline. The manufacturing PMI dropped from a 39-month high of 55.2 in August to 52.1. Meanwhile, survey respondents highlighted the inflationary impact of tariffs on input costs. However, many firms are struggling to pass these costs onto consumers due to sluggish demand and intensifying price competition. Positively, the survey indicated that business confidence in the outlook improved following the interest rate cut last week.

CONTACT US

Editor:   Lisette IJssel de Schepper
Tel:         +27 (0)21 808 9777
Email:   lisette@sun.ac.za

Please refer to the glossary on the BER website for explanations of technical terms.