Picture: ISTOCK
Picture: ISTOCK

The Reserve Bank’s composite leading business cycle indicator increased slightly in September‚ to 98.4 from 97.2 in August.

The indicator, released on Tuesday, is a strong indicator of SA’s economic growth cycle for the next six to 12 months.

The Bank compiles the leading indicator by assessing monthly movements in various economic indicators, such as interest rate spreads, new passenger vehicles sold and job advertisements.

Five of nine of the component time series that make up the indicator increased, while four decreased.

The largest positive contribution came from an increased number of residential building plans passed, followed by an increase in the South African produced export commodity price index, which is measured in dollars.

The largest negative contributor was a deceleration of the business cycle indicator of SA’s major trading-partner countries.

The composite coincident business cycle indicator, which moves in line with current economic growth, increased 0.9% in September from August, while the composite lagging business cycle indicator decreased 0.7% month on month.

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