Following a cumulative 24 index point rise during 2016Q2 and 2016Q3, the FNB/BER Civil Confidence Index shed 17 points to register a level of 35 in 2016Q4. A number of factors contributed to the drop in confidence, including lower activity growth, keener competition and, consequently, also weaker profitability.

The seasonally adjusted Absa Purchasing Managers’ Index (PMI) rose by a further 1.6 points to 52.5 index points in February, after a 4.2-point rise in January. The second consecutive improvement in the PMI and the broad-based nature of the uptick across the key subcomponents is a positive sign that the manufacturing sector started the year on a solid footing. Indeed, four of the five major subcomponents are above the neutral 50-point mark and the headline figure is at the highest level since June 2016. After the increases recorded in January and February, the headline figure is closer to that of South Africa’s main trading partners after underperforming through the second half of 2016.

The FNB/BER Building Confidence Index improved for the third consecutive quarter, rising by 3 points to 43 in 2017Q1. This marks the highest confidence in more than a year. However, despite the higher confidence, building activity was broadly lower, especially for main contractors.

After rebounding from -11 index points in 2016Q2 to -3 in 2016Q3, the FNB/BER Consumer Confidence Index (CCI) sagged back to -10 in 2016Q4. The deterioration in consumer sentiment during 2016Q4 came on the back of a reversal in the gains that were made during the third quarter for the two forward-looking sub-indices of the CCI.

Economic indicators

Key indicators

Sat Mar 25 2017 02:22:01

Rand-Dollar

12.4370

0.12%

Rand-Pound

15.5089

1.25%

Rand-Euro

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0.04%

Gold

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0.00%

Platinum

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0.00%

Brent Crude EOD

50.56

0.00%

R186

8.36

0bps

R207

7.43

0bps

Share indices (Previous day's close)

Last updated: Fri Mar 24 2017 08:14:49

JSE all-share

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2346

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German Dax

12040

1.14 %

Japan Nikkei

19085

0.23 %

Please note

BER MORNING BRIEFING

The SA economy, ANC succession and global disruption: The new normal of uncertainty

Date: Friday 12 May 2017
Venue: Radisson Blu Hotel, Sandton

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Recent releases

The FNB/BER Building Confidence Index improved for the third consecutive quarter, rising by 3 points to 43 in 2017Q1. This marks the highest confidence in more than a year. However, despite the higher confidence, building activity was broadly lower, especially for main contractors....Get it here

This report outline some of the key findings of the BER’s 2017Q1 Building survey, including the FNB/BER Building Confidence Index. The FNB/BER Building Confidence Index improved for the third consecutive quarter, rising by 3 points to 43 in 2017Q1. This marks the highest confidence in more than a year. However, despite the higher confidence, building activity was broadly lower, especially for main contractors. ...Get it here

This report outline some of the key findings of the BER’s 2017Q1 Building survey, including the FNB/BER Building Confidence Index. The FNB/BER Building Confidence Index improved for the third consecutive quarter, rising by 3 points to 43 in 2017Q1. This marks the highest confidence in more than a year. However, despite the higher confidence, building activity was broadly lower, especially for main contractors. The data for 2017Q1 is also provided....Get it here

The FNB/BER Building Confidence Index improved for the third consecutive quarter, rising by 3 points to 43 in 2017Q1. This marks the highest confidence in more than a year. However, despite the higher confidence, building activity was broadly lower, especially for main contractors....Get it here

The 2017Q1 BER Retail Survey indicates that business confidence among retailers ticked up despite a deterioration in underlying business conditions. As in previous survey rounds, there were mixed results for the various subcategories. In all, low levels of consumer confidence, subdued growth in consumers’ real disposable income and tighter fiscal policy should continue to weigh on retail sales growth over coming months. ...Get it here

The 2017Q1 BER Retail Survey indicates that business confidence among retailers ticked up despite a deterioration in underlying business conditions. As in previous survey rounds, there were mixed results for the various subcategories. In all, low levels of consumer confidence, subdued growth in consumers’ real disposable income and tighter fiscal policy should continue to weigh on retail sales growth over coming months....Get it here

Summary text, with a link to a video presentation, of the key results and implications of the latest round of BER business survey results in 2017Q1. ...Get it here

Various gauges of domestic economic activity were published last week, most indicating that 2017 started off at a slow pace. Business confidence remained broadly pessimistic in Q1, while manufacturing production and retail sales underperformed in January. However, mining output provided a positive balance. On the international stage, a number of central banks announced policy interest rate decisions last week. As such, rates were hiked in the US and China, while in the UK the policy rate remained unchanged. Besides these, the results of the general elections in the Netherlands are discussed briefly....Get it here

The RMB/BER BCI increased by a minuscule two points to 40 in the first quarter of 2017. Confidence has been (well) below the neutral 50 mark for more than two years - a pattern consistent with an economy continuously treading water. With the exception of a few industries which are benefitting to some extent from the revival in agriculture, mining and manufacturing exports, the overriding message from the first quarter survey results would seem to be one of continuously weak underlying activity with most sectors still in a holding pattern....Get it here

It was a quiet week on the domestic data front, with the only notable release that of the 2016Q4 GDP figures from Statistics South Africa (Stats SA). GDP growth disappointed in Q4, coming in below market expectations. As a result, 2016 GDP growth was the worst since the 2009 recession. More details in the domestic section and on the BER website. In international news, China recorded its first trade deficit in three years, while the European Central Bank (ECB) kept its monetary policy stance unchanged. Further afield, the US economy added 235 000 jobs in February, beating consensus and paving the way for an interest rate hike later this week....Get it here

Forecast publications

The global and domestic economic environment is confronted by high levels of uncertainty. While this is not unique since the 2008/9 global crisis, the current uncertainty is largely on the political and policy front. This implies that a number of scenarios are possible over the forecast period....Get it here

The global and domestic economic environment is confronted by high levels of uncertainty. While this is not unique since the 2008/9 global crisis, the current uncertainty is largely on the political and policy front. This implies that a number of scenarios are possible over the forecast period....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

Our updated forecast is for average SA GDP growth of a modest 1.8% during 2016-21. The average is depressed by weak 2016 and 2017 numbers - growth of 2.4% is pencilled in for 2018-21. While still subdued, this is on par with the (modest) performance of 2010-15. ...Get it here

Our latest six-year forecast can be divided into two distinct periods. The short-term prospects for the economy are decidedly downbeat with global and (increasingly) domestic factors conspiring to depress growth to well below potential levels in 2016 (0.4%) and 2017 (1.3%). Over the medium term, GDP growth is forecast to recover to an average of 2.8% between 2019 and 2021. We modelled a risk scenario of multiple credit rating downgrades that results in a significant slowdown in foreign capital inflows from the second half of 2016. This environment sees the rand weakening to an average of R21/$ in 2017Q4, before recovering from early 2018....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

Various gauges of domestic economic activity were published last week, most indicating that 2017 started off at a slow pace. Business confidence remained broadly pessimistic in Q1, while manufacturing production and retail sales underperformed in January. However, mining output provided a positive balance. On the international stage, a number of central banks announced policy interest rate decisions last week. As such, rates were hiked in the US and China, while in the UK the policy rate remained unchanged. Besides these, the results of the general elections in the Netherlands are discussed briefly....Get it here

It was a quiet week on the domestic data front, with the only notable release that of the 2016Q4 GDP figures from Statistics South Africa (Stats SA). GDP growth disappointed in Q4, coming in below market expectations. As a result, 2016 GDP growth was the worst since the 2009 recession. More details in the domestic section and on the BER website. In international news, China recorded its first trade deficit in three years, while the European Central Bank (ECB) kept its monetary policy stance unchanged. Further afield, the US economy added 235 000 jobs in February, beating consensus and paving the way for an interest rate hike later this week....Get it here

In domestic news, the February print of the Absa Purchasing Managers’ Index (PMI) suggests that the manufacturing sector continues to recover following a contraction in the final months of 2016. In contrast, new vehicle sales fell back after posting a welcome rise in January. On the international front, the probability of a March interest rate hike in the US has increased following a number of positive data releases. We also unpack US President Trump’s first speech in Congress and the latest PMI data from China....Get it here

The domestic economic calendar was dominated by the tabling of the National Budget by Minister of Finance Pravin Gordhan on Wednesday. While significant personal income tax (PIT) hikes should depress consumer spending, there may be some relief from lower inflation in 2017. Indeed, price increases at factory gates slowed more than expected in January (see the domestic section). In the international section we unpack the release of the Federal Reserve’s Open Market Committee’s (FOMC) February meeting minutes. Despite the statement that the policy interest rate may be hiked “fairly soon”, market expectations remained low for a rate hike at the Fed’s upcoming meeting in March. The section also reviews the latest Purchasing Managers’ Index (PMI) figures from the US, Eurozone and Japan. ...Get it here

In the domestic section we review the latest employment, retail trade and inflation data from Statistics South Africa (Stats SA). The labour data showed that despite a quarterly dip in the unemployment rate in 2016Q4, annual job growth remained weak. Subdued employment growth makes Finance Minister Pravin Gordhan’s job to balance the books in Wednesday’s annual National Budget statement even more challenging. On the international front, the key economic event was the semi-annual testimony by US Federal Reserve (Fed) Chair Janet Yellen before the Senate Banking Committee. Although Yellen’s comments did not contain a lot of new information, it was interpreted as being slightly more hawkish on the US interest rate outlook. Higher-than-expected US inflation and more upbeat retail sales data released last week support the case for Fed rate hikes going forward. ...Get it here

Socio-political topics dominated the domestic agenda last week. As such, the current affairs section focuses on the new national minimum wage (NMW) announced by the deputy president, as well as the State of the Nation Address (SONA) by President Jacob Zuma. The domestic section touches on the mining and manufacturing data which is now complete for 2016Q4, and confirms a contraction in both sectors....Get it here