Economy still looks on course for 2% growth
AT PRESENT, the economy is still on course for about 2 percent growth for the year despite power outages and recent fuel hikes, according to last month’s BankservAfrica economic transaction index (Beti).
And compared with last year, Beti looks more stable and predictable, which is preferable to the volatile nature of the index last year.
BankservAfrica is a paymentorganisation operating between South African banks, with a very secure messaging environment in place.
BankservAfrica said data from the last four months indicated a greater number of transactions had taken place, but real growth inside the South African payment system remained slow.
The year-on-year growth has been between 1.2 percent and 2.1 percent over the last two months. The total nominal value change was 5.4 percent.
The standardised Beti was R689.6 billion, while the number of transactions came to R82.8 million.
BankservAfrica said after a disappointing decline for March in month-on-month growth, April reflected a positive growth rate, but at 0.3 percent, this growth was still far from strong.
The quarter-on-quarter growth is better at 1.8 percent, but seems to be due to the strong February numbers.
“The Beti does appear to indicate that despite the three public holidays, April 2015 was just an ordinary holiday month, showing that the value of transactions is still growing at a subdued pace,” Caroline Belrose, the head of fraud and data analytics at BankservAfrica, said.
Mike Schussler, the chief economist at Economists.co.za, said the fact was the South African economy was being held back by power outages and large fuel increases.
“While the actual petrol and diesel prices are still well below last year’s levels, the 14 percent increase in one month has certainly hampered confidence and spending power.
“There is no clear shift in economic growth rates and, apart from February, the Beti indicates that growth remains lacklustre,” Schussler said.
Manufacturing
He said while other figures released showed a weakening manufacturing sector and fewer car sales, the Beti indicated the economy as a whole was subdued rather than shrieking.
“The fact that there was positive growth in the first quarter means 2015 should fare better than 2014,” he said.
Meanwhile, the seasonally adjusted composite trade activity by the SA Chamber of Commerce and Industry (Sacci) was slightly in positive territory last month. It improved by 4 index points to 51, but still below 62 in January and 56 in December.
Sacci said that it appeared over the medium term trade conditions would remain “middle of the road”.
The sales volumes subindex dipped by 4 index points from 55 in March, while new orders followed the same trend and recorded 50 last month, down from 55.
Foreign trade appears to be improving as both import and export volumes increased, while domestic demand remained under pressure, given real household and public sector spending constraints.
Expected and current employment prospects deteriorated as both the expectations and current indices declined by 1 and 3 points respectively to 45 and 47 points.