SA’s second-quarter GDP figures will be the main highlight this week, which is packed with other data releases, including the closely watched business confidence index compiled by the Bureau for Economic Research (BER) in partnership with Rand Merchant Bank (RMB).
Stats SA will release the GDP figures on Tuesday, followed by mining production for June on Wednesday. According to a Bloomberg median estimate, mining output is expected to have grown 21% in June on an annualised basis, from 21.9% in May.
The June quarter was marred by the surge in Covid-19 cases in SA’s economic heartland of Gauteng, in particular, which resulted in the temporary ban on the sale of alcohol as the country moved to an adjusted level 4 of the lockdown in late June. At the time, restaurants were allowed to prepare and sell food for takeaway only.
Retail sales have been sluggish in the three months to June but fared better compared with the same period a year ago when SA encountered its first hard lockdown, which only allowed essential services. Retail sales are a reliable gauge of consumer spending patterns.
The mining industry continued to be the bright spot, thanks to the boom in commodity prices, though most of them have since levelled off.
SA’s GDP is likely to have expanded at an annualised rate of 2% in the second quarter, according to a Bloomberg median estimate, slowing from 4.6% in the first quarter.
FNB economists expect SA’s economy to have grown 0.9% quarter on quarter and 18.5% year on year, “reflecting a solid rebound from the lockdown-induced deep decline of 16.9% in the second quarter”.
Other reliable high-frequency cyclical indicators, bar manufacturing production, show that quarterly growth momentum persisted into the second quarter, the FNB economists said in a note.
The RMB/BER business confidence index will be released on Wednesday, reflecting the widespread looting and damage to property in parts of KwaZulu-Natal and Gauteng in the third quarter.
After declining five points in the first quarter, the index jumped 15 points to 50, its neutral level, in the second quarter. Confidence rebounded, especially sharply in the manufacturing, retail trade and motor trade sectors.
Beyond the unprecedented looting, SA business also grappled with supply-chain disruptions, with the period being marked by a cyberattack on Transnet, which caused operations at ports to halt.
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