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Research Notes are more in-depth analyses undertaken by BER economists and consultants.
Brief note intended as a more regular interface with our clients.
The Impumelelo Economic Growth Lab is a unit at the BER, focussing on generating policy-relevant work and capacity building to achieve economic success in South Africa. This work is freely available to access on our website.
The SA economy came out of the technical recession in 2018Q3. Stats SA reported that GDP expanded by 2.2% quarter-on-quarter (q-o-q), annualised, a robust recovery from an upwardly revised 0.4% contraction in 2018Q2.
Read MoreThe underlying survey results are consistent with a mild improvement in growth during the fourth quarter, even with the slight decline in the overall RMB/BER Business Confidence Index (BCI). The BER expects that Q3 GDP (released 4 December) will register a positive growth rate (on a quarter-on-quarter seasonally adjusted and annualised basis). According to the past relationship between the survey results and GDP growth, year-on-year growth is likely to remain relatively weak in the second half of 2018. We would need to see a sustained, broad-based increase in the BCI for economic growth to improve noticeably next year and beyond.
Read MoreRelative to the February Budget, the MTBPS revealed significant slippage on the fiscal consolidation with overall government debt now expected to stabilise just below 60% of GDP.
In a close decision, the MPC kept the repo policy interest rate unchanged at 6.50%.
This presentation style note shows that the further dip in confidence and activity during the third quarter does not bode well for year-on-year GDP growth (at least non-agricultural GDP) in Q3. Overall, the survey results foreshadow continued underperformance of the economy in the second half of the year. This implies that it may be difficult to register even 1% GDP growth in 2018.
Read MoreStats SA reported that the SA economy slipped into a technical recession in 2018Q2.
This presentation-style note summarises the second quarter business survey results. In line with the drop in the RMB/BER Business Confidence Index, the average activity indicator dipped back to 17Q4 levels. Overall, the survey results highlight the tight spot the economy is currently in and imply that GDP growth for 2018 as a whole might be closer to 1.5% than to 2%
Read MoreStats SA reported that GDP declined in 2018Q1. On a number of fronts, it was a horrible GDP print.
A short note on key takeaways from a BER panel discussion on the land issue.
As expected, the MPC kept the repo policy interest rate unchanged at 6.50% (prime rate at 10.00%).
As widely expected, the MPC reduced the repo policy interest rate by 25bps to 6.50% (prime rate at 10.00%).
The results foreshadow that we may already be in a cyclical upturn and bodes well for GDP growth from 2018 onwards. While overall GDP growth is likely to moderate in Q1, considering the survey results, this may not necessarily be the case for growth in GDP excluding the primary sector. Selling price indicators in the Q1 results are consistent with low consumer inflation and this should support sales volumes this year. Expected indicators for Q2 suggest contained VAT impact (at least initially).
Read MoreThis is BER Director Prof Johann Kirsten’s inaugural address as delivered on 21 November 2017
The Budget started to repair the fiscal credibility lost in October when the MTBPS shocked domestic financial markets and resulted in further sovereign credit rating downgrades.
