SA clambers out of recession but retail sector is likely to retard growth
Even as SA clambered out of recession, it is unlikely to experience meaningful growth on the back of a slump in the retail sector. The sector grew less than expected at the start of the third quarter with marginal growth of 1.8% year on year in July 2017 compared to 2.9% in June. The Rand Merchant Bank Bureau for Economic Research (RMB/BER) business confidence index (BCI) for the third quarter showed an economy still struggling to maintain meaningful growth, although it rebounded slightly from the dismal second-quarter drop. The index was up by six points to 35 in the third quarter from 29 in the previous one. Crucially, the index and sub-indices remained below the neutral 50 level, which divides expansion from contraction. Consistent with mediocre growth in trade volumes, retail confidence remained virtually unchanged, picking up just three points to 38. In a statement on Wednesday, RMB/BER said: "This is not the environment in which the economy is about to experience a resurgence....
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