The FNB/BER Civil Confidence Index gained 3 points to register a level of 15 in 2018Q2. The sustained low confidence is explained by a deterioration in almost all of the underlying indicators, most notably construction activity and tendering competition.

The seasonally adjusted Absa Purchasing Managers’ Index (PMI) fell further below the neutral 50-point mark in June. The index lost 1.9 points to reach 47.9, down from 49.8 points in May. The dip means that the average level recorded during the second quarter is only 0.3 points above the first-quarter average and still below the key 50 level. This suggests that the sector is unlikely to stage a solid recovery after output contracted on a quarter-on-quarter basis in the first quarter.

After surging from 34 to 45 in the first quarter, the RMB/BER Business Confidence Index (BCI) deteriorated to 39 in the second quarter of 2018. This means that close to three fifths of respondents now regard prevailing business conditions as unsatisfactory – a disappointing outcome, yet probably an accurate reflection of reality.

After skyrocketing to an all-time high during the first quarter of 2018, the FNB/BER Consumer Confidence Index (CCI) dipped marginally in the second quarter. Since negative corrections have typically followed large spikes in the CCI in the past, we are somewhat surprised that consumer confidence levels remained so high following the unparalleled surge in consumer sentiment during the first quarter of 2018. Furthermore, there were several adverse developments in recent months that had the potential to deflate consumer confidence. Although the elevated consumer confidence level suggests that consumers remain most willing to spend their money, this does not necessarily imply that actual consumer spending remained robust during the second quarter. Household income levels and/or access to credit would have had to improve in conjunction with the positive sentiment to see strong household expenditure growth during the second quarter. Although the seeds of an economic recovery were planted with President Ramaphosa's "new dawn" and pledge to eradicate the scourge of corruption, further investor-friendly reforms are urgently needed to boost economic growth and household income levels to avoid bitter disappointment.

Economic indicators

Key indicators

Mon Jul 23 2018 18:53:01

Rand-Dollar

13.5125

0.83%

Rand-Pound

17.7080

0.56%

Rand-Euro

15.8077

0.61%

Gold

1223.38

-0.52%

Platinum

828.48

0.19%

Brent Crude EOD

73.07

0.00%

R186

8.76

5bps

R207

7.48

4bps

Share indices (Previous day's close)

Last updated: Mon Jul 23 2018 06:17:01

JSE all-share

56990

1.27 %

JSE Top 40

50904

1.40 %

US S&P 500

2802

-0.09%

German Dax

12561

-0.98%

Japan Nikkei

22698

-0.29%

Please note


Recent releases

Locally, the focus was on the South African Reserve Bank’s (SARB) policy interest rate decision. As expected, the SARB kept the rate unchanged, but the overall tone of the statement was fairly hawkish. In addition, we unpack the latest retail and wholesale trade data as well as the June inflation print. On the international front, the focus is also on inflation figures from the Eurozone and the United Kingdom. The section further summarises the latest industrial production and retail sales data from the US, which both point to a strong Q2 GDP print. ...Get it here

Monthly survey of leading South African economists who forecast key macroeconomic variables....Get it here

In the second quarter, average headline CPI inflation expectations for 2018 remained unchanged relative to the first quarter, but edged up marginally by 0.1 percentage point (% pt) in respect of 2019 and 2020....Get it here

In the second quarter, average headline CPI inflation expectations for 2018 remained unchanged relative to the first quarter, but edged up marginally by 0.1 percentage point (% pt) in respect of 2019 and 2020....Get it here

After skyrocketing to an all-time high during the first quarter of 2018, the FNB/BER Consumer Confidence Index (CCI) dipped marginally in the second quarter. Since negative corrections have typically followed large spikes in the CCI in the past, we are somewhat surprised that consumer confidence levels remained so high following the unparalleled surge in consumer sentiment during the first quarter of 2018. Furthermore, there were several adverse developments in recent months that had the potential to deflate consumer confidence. Although the elevated consumer confidence level suggests that consumers remain most willing to spend their money, this does not necessarily imply that actual consumer spending remained robust during the second quarter. Household income levels and/or access to credit would have had to improve in conjunction with the positive sentiment to see strong household expenditure growth during the second quarter. Although the seeds of an economic recovery were planted with President Ramaphosa's "new dawn" and pledge to eradicate the scourge of corruption, further investor-friendly reforms are urgently needed to boost economic growth and household income levels to avoid bitter disappointment....Get it here

After skyrocketing to an all-time high during the first quarter of 2018, the FNB/BER Consumer Confidence Index (CCI) dipped marginally in the second quarter. Since negative corrections have typically followed large spikes in the CCI in the past, we are somewhat surprised that consumer confidence levels remained so high following the unparalleled surge in consumer sentiment during the first quarter of 2018. Furthermore, there were several adverse developments in recent months that had the potential to deflate consumer confidence. Although the elevated consumer confidence level suggests that consumers remain most willing to spend their money, this does not necessarily imply that actual consumer spending remained robust during the second quarter. Household income levels and/or access to credit would have had to improve in conjunction with the positive sentiment to see strong household expenditure growth during the second quarter. Although the seeds of an economic recovery were planted with President Ramaphosa's "new dawn" and pledge to eradicate the scourge of corruption, further investor-friendly reforms are urgently needed to boost economic growth and household income levels to avoid bitter disappointment....Get it here

After skyrocketing to an all-time high during the first quarter of 2018, the FNB/BER Consumer Confidence Index (CCI) dipped marginally in the second quarter. Since negative corrections have typically followed large spikes in the CCI in the past, we are somewhat surprised that consumer confidence levels remained so high following the unparalleled surge in consumer sentiment during the first quarter of 2018. Furthermore, there were several adverse developments in recent months that had the potential to deflate consumer confidence. Although the elevated consumer confidence level suggests that consumers remain most willing to spend their money, this does not necessarily imply that actual consumer spending remained robust during the second quarter. Household income levels and/or access to credit would have had to improve in conjunction with the positive sentiment to see strong household expenditure growth during the second quarter. Although the seeds of an economic recovery were planted with President Ramaphosa's "new dawn" and pledge to eradicate the scourge of corruption, further investor-friendly reforms are urgently needed to boost economic growth and household income levels to avoid bitter disappointment....Get it here

After skyrocketing to an all-time high during the first quarter of 2018, the FNB/BER Consumer Confidence Index (CCI) dipped marginally in the second quarter. Since negative corrections have typically followed large spikes in the CCI in the past, we are somewhat surprised that consumer confidence levels remained so high following the unparalleled surge in consumer sentiment during the first quarter of 2018. Furthermore, there were several adverse developments in recent months that had the potential to deflate consumer confidence. Although the elevated consumer confidence level suggests that consumers remain most willing to spend their money, this does not necessarily imply that actual consumer spending remained robust during the second quarter. Household income levels and/or access to credit would have had to improve in conjunction with the positive sentiment to see strong household expenditure growth during the second quarter. Although the seeds of an economic recovery were planted with President Ramaphosa's "new dawn" and pledge to eradicate the scourge of corruption, further investor-friendly reforms are urgently needed to boost economic growth and household income levels to avoid bitter disappointment....Get it here

In domestic news, both mining and manufacturing output rebounded in May after posting weak growth in April. However, mining output is still set to contract in 2018Q2, while only a slight rebound is on the cards for manufacturing production as output growth remains lacklustre. Furthermore, the near-term outlook for the mining sector is clouded by the possibility of labour unrest following the commencement of wage negotiations in the gold sector. On the international front, US consumer price inflation rose to a six-year high in June, suggesting further interest rates hikes remain firmly on the cards. Across the pacific, China’s trade surplus with the US rose to a record-high in June which could provide further ammunition for President Trump in the ongoing trade dispute. ...Get it here

On the domestic front, economic news was a mixed bag last week. On the upside, domestic vehicle sales continued to grow, especially in the case of heavy vehicles such as trucks and buses. On the downside, electricity output remained under pressure. On the international scene, nonfarm payroll data indicates that the US economy is still creating new jobs at a steady rate. Meanwhile, June Purchasing Managers’ Indices (PMIs) for the US and China reflect a vibrant economy in the US during the second quarter, and ‘business as usual’ in China. Furthermore, the IMF scaled down its outlook for the German economy. On financial markets the US dollar lost some ground after Chinese officials said they will not use the yuan as a trade-policy weapon, benefiting emerging market (EM) currencies to some extent. ...Get it here

Forecast publications

The GDP contraction in 2018Q1 and likely modest recovery in Q2 has forced a sizeable downward adjustment to our 2018 real GDP growth forecast....Get it here

The GDP contraction in 2018Q1 and likely modest recovery in Q2 has forced a sizeable downward adjustment to our 2018 real GDP growth forecast....Get it here

Excel sheets summarising the forecasts published in the latest issues of Economic Prospects (2-year quarterly forecast) and Economic Outlook (6-year annual forecast). Where possible, the forecast sheets have been updated with the latest available information.

...Get it here

Excel sheets summarising the forecasts published in the latest issues of Economic Prospects (2-year quarterly forecast) and Economic Outlook (6-year annual forecast). Where possible, the forecast sheets have been updated with the latest available information.

...Get it here

Medium-term prospects for the SA economy have improved. Mostly, this stems from notably less concern about domestic politics and the policy environment....Get it here

Given the lack of visibility on politics and the recent negative experience, we have stuck to a conservative medium-term real GDP growth outlook of only 1.6%....Get it here

Snapshot

Graphs of the latest monthly and quarterly South African economic and financial data. The focus is on the essential indicators to give the reader a quick overview of general economic conditions....Get it here

Graphs of the latest monthly and quarterly South African economic and financial data. The focus is on the essential indicators to give the reader a quick overview of general economic conditions....Get it here

Graphs of the latest monthly and quarterly South African economic and financial data. The focus is on the essential indicators to give the reader a quick overview of general economic conditions....Get it here

Graphs of the latest monthly and quarterly South African economic and financial data. The focus is on the essential indicators to give the reader a quick overview of general economic conditions....Get it here

Graphs of the latest monthly and quarterly South African economic and financial data. The focus is on the essential indicators to give the reader a quick overview of general economic conditions....Get it here

Graphs of the latest monthly and quarterly South African economic and financial data. The focus is on the essential indicators to give the reader a quick overview of general economic conditions....Get it here

Weekly

Locally, the focus was on the South African Reserve Bank’s (SARB) policy interest rate decision. As expected, the SARB kept the rate unchanged, but the overall tone of the statement was fairly hawkish. In addition, we unpack the latest retail and wholesale trade data as well as the June inflation print. On the international front, the focus is also on inflation figures from the Eurozone and the United Kingdom. The section further summarises the latest industrial production and retail sales data from the US, which both point to a strong Q2 GDP print. ...Get it here

In domestic news, both mining and manufacturing output rebounded in May after posting weak growth in April. However, mining output is still set to contract in 2018Q2, while only a slight rebound is on the cards for manufacturing production as output growth remains lacklustre. Furthermore, the near-term outlook for the mining sector is clouded by the possibility of labour unrest following the commencement of wage negotiations in the gold sector. On the international front, US consumer price inflation rose to a six-year high in June, suggesting further interest rates hikes remain firmly on the cards. Across the pacific, China’s trade surplus with the US rose to a record-high in June which could provide further ammunition for President Trump in the ongoing trade dispute. ...Get it here

On the domestic front, economic news was a mixed bag last week. On the upside, domestic vehicle sales continued to grow, especially in the case of heavy vehicles such as trucks and buses. On the downside, electricity output remained under pressure. On the international scene, nonfarm payroll data indicates that the US economy is still creating new jobs at a steady rate. Meanwhile, June Purchasing Managers’ Indices (PMIs) for the US and China reflect a vibrant economy in the US during the second quarter, and ‘business as usual’ in China. Furthermore, the IMF scaled down its outlook for the German economy. On financial markets the US dollar lost some ground after Chinese officials said they will not use the yuan as a trade-policy weapon, benefiting emerging market (EM) currencies to some extent. ...Get it here

Short report that reviews important global and domestic financial market and economic data developments of the past week. The BER Weekly is released on Monday mornings.

...Get it here

The rand hit a 7-month low against the US dollar last week as emerging market assets continued to suffer....Get it here

A raft of domestic data released last week suggested that, after a poor first quarter, the SA economy remained under pressure at the start of 2018Q2. ...Get it here