20 December 2019 – The business cycle improved at the start of the fourth quarter as the indicators for October ticked up slightly, despite subdued trade conditions and consumer confidence.
The SA Reserve Bank (Sarb) said the composite leading business cycle indicator surprised on the upside, increasing 0.7 percent on a month-to-month basis in October.
The indicator has contracted year-on-year for 12 consecutive months, most recently falling 1.5 percent in September, signalling that growth prospects were expected to remain historically low.
The central bank has maintained the view that South Africa was unlikely to see a material improvement in growth prospects heading into 2020 without meaningful structural reforms taking place. It has already cut its growth forecast for 2019 by more than half, from a gross domestic product of 1.5 percent forecast in February to 0.5 percent last month, as a result of weak fundamentals.
In the leading indicator, Sarb said eight of the 10 available component time series increased, while two decreased. Source (Business Report)