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Economic Outlook November 2022

The next 12 to 18 months could prove to be a difficult period for the global and SA economy, with growth forecasts being downgraded. However, beyond 2023, an environment of lower global inflation and presumably also some relief on the interest rate front should see improved global growth. If, at the same time, the rollout of green-energy projects in SA picks up momentum, SA medium-term real GDP growth could double relative to the poor performance in the five years before COVID. This report details how the latest forecast balances the opposing forces that are set to impact the SA economy.

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Recent Releases



After moving marginally higher to 10 in 2022Q2, the FNB/BER Civil Confidence Index increased further to 24 in 2022Q3, a level last reached in 2020Q1. Despite the improvement in sentiment, the current index level means that more than seventy-five per cent of respondents were dissatisfied with prevailing business conditions.

The seasonally adjusted Absa Purchasing Managers’ Index (PMI) rose from 48.2 index points in September to 50 in October. This is slightly better than the average recorded during the previous quarter (49.6). However, the Transnet strike and faltering global demand likely hurt exports, while persistent load-shedding capped the recovery in activity and demand.

After dipping from 42 to 39 in the third quarter, the RMB/BER business confidence index (BCI) slipped to 38 in the final quarter of 2022. A rebound in building confidence made up for the first significant falls in wholesale and retail confidence since the COVID-19 pandemic broke out. Escalating load-shedding could easily have dashed business confidence in the fourth quarter. The fact that the RMB/BER BCI essentially remained unchanged indicates the presence of some underlying resilience as well as countervailing forces at work.

After plunging from -13 to -25 during the second quarter of 2022, the FNB/BER Consumer Confidence Index (CCI) clawed back 5 index points to reach -20 in the third quarter. Consumer sentiment remains extremely depressed and signals a substantial deceleration in real consumer spending growth relative to the robust rates recorded at the start of the year.