South Africa: Country Economic Forecast: 31 Jan 2012

Oxford Economics
January 31, 2012
11 Pages - SKU: OFE6788891
Domestic demand, the key driver of growth in South Africa, continues to grow steadily. The volume of retail sales increased by an average of 1.3% in October and November compared with the previous two months and domestic purchases of new vehicles grew by 10.6% year-on-year in Q4. In contrast, external demand for South Africa's goods has continued to weaken as a result of the deteriorating global environment. Goods exports in US$ terms fell by 2.7% on the year in November, with demand from Europe and Asia shrinking by 12.5% and 4.1% respectively. Moderating domestic demand and the worsening global economic climate mean that we now expect GDP to grow by 2.4% this year. As the global economy picks up, growth is expected to rise to 4% in 2013. Consumer price inflation remained at 6.1% in December, taking the average rate for 2011 to 5%. Price pressures are expected to increase this year, as the depreciation of the ZAR in H2 2011 and rising wages and fuel prices feed through. As a result, we expect inflation to peak at 6.5% in Q2 2012 and to average 6.3% over the year as a whole. The competing influences of rising inflation and a worsening economic environment prompted the SARB to leave the repo rate unchanged at 5.5% at its meeting on 19 January. We expect the rate to remain on hold until Q4 2012, after which gradual rises will be needed to combat inflation.

More International Trade reports by Oxford Economics

Country Economic Forecasts - Taiwan by Oxford Economics
Country Economic Forecasts - TaiwanTaiwan GDP surprised on the upside in Q2 as private consumption rebounded after weakness in Q1 while export volumes continued to ...
Country Economic Forecasts - India by Oxford Economics
Country Economic Forecasts - IndiaThere was widespread optimism that the new government would be able to turn around India’s economic fortunes.Although the BJP government has ...
Country Economic Forecasts - Eurozone by Oxford Economics
Country Economic Forecasts - EurozoneThe Eurozone’s already-insipid recovery slowed further in the second quarter of the year, with quarterly GDP growth dipping from 0.3% in ...
Country Economic Forecasts - Canada by Oxford Economics
Country Economic Forecasts - CanadaThe economy speeded up in May, with the monthly measure of GDP rising by 0.4% on the month.This followed a subdued ...
See all reports like this >>



    Online Download  USD 175  
    Global Site License  USD 438  
US: 800.298.5699
Int'l: +1.240.747.3093

Share this report

    Other tasks

    Join Alert Me now!
    Receive bi-weekly email alerts on new market research

    Sign up today!