Consumption in South Africa

South Africa - Consumption
GDP rebound beats expectations in Q3
The economy rebounded in the third quarter of 2022. Underlying momentum rallied in Q3 and expanded at a stronger-than-expected rate of 1.6% on a seasonally adjusted quarter-on-quarter basis. The upturn, which contrasted the prior quarter’s 0.7% contraction, surprised markets on the upside. The return to growth reflected the recovery from the floods that devastated the KwaZulu-Natal province—the country’s second-largest contributor to GDP—in the second quarter.
Domestically, the quarterly improvement was driven by the rebound in public consumption, which grew 0.5% in Q3 (Q2: -0.8% s.a. qoq). Meanwhile, fixed investment growth waned to 0.3%, marking the weakest reading since Q3 2021 (Q2: +0.4% s.a. qoq). Less positively, household spending contracted 0.3% (Q2: +0.6% s.a. qoq), marking the worst result in a year. The improvement in the unemployment rate (Q3: 32.9%; Q2: 33.9%) was not enough to shield consumers from elevated inflation (Q3: 7.7%; Q2: 6.6%) but likely prevented a sharper contraction in spending.
On the external front, exports of goods and services rebounded, growing 4.2% seasonally adjusted quarter on quarter in Q3 (Q2: -0.2% s.a. qoq), which marked the best reading since Q4 2021. Conversely, the growth of imports of goods and services softened to 0.6% in Q3 (Q2: +5.5% s.a. qoq). Consequently, the external sector contributed 0.9 percentage points to overall growth, contrasting the prior period’s 1.5 percentage point detraction.
On an annual basis, economic growth gathered pace, rising to 4.1% in Q3, from the previous period’s 0.2%. Q3’s reading marked the best result since Q2 2021. The South African economy is now larger than it was before the pandemic.
FocusEconomics Consensus Forecast panelists project GDP to expand 1.4% in 2023, which is unchanged from last month’s forecast. For 2024, panelists see GDP growth at 1.8%.
South Africa - Consumption Data
2015 | 2016 | 2017 | 2018 | 2019 | |
---|---|---|---|---|---|
Consumption (annual variation in %) | 1.9 | 0.6 | 2.1 | 1.8 | 1.1 |
South Africa Facts
Value | Change | Date | |
---|---|---|---|
Bond Yield | 8.26 | 0.29 % | Dec 31 |
Exchange Rate | 13.98 | -0.21 % | Dec 31 |
Stock Market | 0.1 | -0.44 % | Jan 06 |
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Economic News
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South Africa: SARB slows down pace of tightening in January
January 26, 2023
At its 24–26 January meeting, the Monetary Policy Committee of the South African Reserve Bank (SARB) increased the repurchase rate by 25 basis points, bringing it to 7.25%.
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South Africa: Inflation continues its downward trend in December
January 18, 2023
Inflation fell to 7.2% in December, easing slightly from November’s 7.4%.
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South Africa: Manufacturing activity rebounds in November
January 10, 2023
Manufacturing output increased 2.0% in month-on-month seasonally adjusted terms in November, which contrasted October's 6.2% decrease.
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South Africa: Private-sector conditions improve marginally in December
January 5, 2023
The S&P Global Purchasing Managers’ Index (PMI) moderated to 50.2 in December, down from November’s 50.6.
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South Africa: Inflation drops to lowest level since June in November
December 14, 2022
Inflation dropped to 7.4% in November from October’s 7.6%.