Investment in South Africa
South Africa - Investment
Economy rebounds robustly in Q3 amid easing of lockdown restrictions
The economy rebounded strongly in the third quarter, growing at the quickest rate since current records began in the early 1990s, as the easing of coronavirus lockdown measures enabled the gradual firming of activity. GDP surged 66.1% at a seasonally-adjusted annualized rate (SAAR) in Q3, swinging from the 51.7% contraction seen in the second quarter and beating market analysts’ expectations of a 52.6% rise. In annual terms, economic activity dropped 6.0% in Q3, marking a softer contraction than the previous quarter’s 17.5% decline.
The robust bounce-back reflected notable improvements in domestic as well as external demand. Private consumption jumped 69.5% SAAR in Q3, contrasting the 52.4% contraction in Q2, as consumers resumed their purchases. Furthermore, fixed investment surged 26.5% in the quarter, swinging from Q2’s 59.8% contraction, while government consumption rebounded, growing 0.7% in Q3 (Q2: -2.1% SAAR).
On the external front, exports of goods and services rebounded, growing 201.4% in Q3 (Q2: -76.0% SAAR) as global demand picked up. In addition, imports of goods and services fell at a softer pace of 1.6% in Q3 (Q2: -54.0% SAAR), suggesting a firming of the domestic economy.
Commenting on the outlook for the South African economy, Andrew Matheny and Dylan Smith, economists at Goldman Sachs, noted:
“Today's data imply a mechanical adjustment to our 2020 growth forecast to -7.2%yoy, 1.1pp stronger than previously (while incorporating a slightly weaker sequential growth rate in Q4). Our 2021 growth forecast now stands at +5.3%yoy, up from +4.5% previously. We also revise up our forecast for the Q3 current account balance […] to a surplus of 4.6% of GDP or ZAR230bn (annualised), up from 4.2% of GDP or ZAR210bn previously, on account of weaker service imports than we had anticipated.”
FocusEconomics Consensus Forecast panelists project the economy to expand 3.6% in 2021, which is unchanged from last month’s forecast. In 2022, GDP is seen growing 2.5%.
South Africa - Investment Data
|Investment (annual variation in %)||2.5||-3.5||1.0||-1.4||-0.9|
5 years of economic forecasts for more than 30 economic indicators.
South Africa Facts
|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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February 17, 2021
Consumer prices rose 0.34% in January over the previous month, picking up from the 0.17% increase recorded in December and marking the sharpest increase in prices since July 2020.
February 11, 2021
Manufacturing output increased 1.8% compared to the same month a year earlier in December, which contrasted November's 4.1% decrease and marked the strongest expansion since April 2019.
February 3, 2021
The South Africa IHS Markit Purchasing Managers’ Index (PMI) rose to 50.8 in January, from December’s 50.2, marking the best reading in three months.
January 21, 2021
At its first meeting of the year on 21 January, the Monetary Policy Committee (MPC) of the South African Reserve Bank (SARB) left the repurchase rate unchanged at its record low of 3.50%.
January 20, 2021
Consumer prices increased 0.17% in December over the previous month, after November's flat result.