Business Day Spotlight
PODCAST | SA’s consumer confidence is at a very low level
FNB’s CCI shows that consumers are generally pessimistic about the state of the economy
In this edition of Business Day Spotlight, we explore the mood and pressures faced by consumers in SA.
Our host Mudiwa Gavaza is joined by Siphamandla Mkhwanazi, senior economist at FNB to discuss the results of their consumer confidence index (CCI), undertaken in collaboration with the Bureau for Economic Research.
SA consumers are struggling:
In the first part of the discussion, Mkhwanazi explains how the CCI, which gauges the mood of SA consumers, is determined. From the third quarter of 2019, the research found that consumers are generally pessimistic about the state of the economy.
“Consumer sentiment remains depressed on the back of weak economic growth, record-high unemployment, and Eskom’s ongoing electricity supply crisis and financial woes,” he says.
“Furthermore, the 2019 medium-term budget policy statement delivered by finance minister Tito Mboweni at the end of October highlighted a stark, further deterioration in government finances, raising concerns about possible cutbacks in government employment, additional tax hikes for consumers and Moody’s lowering SA’s only remaining investment grade sovereign credit rating to junk status in 2020.”
However, he does say consumers have had some respite in terms of stable inflation and interest rates in the last year. The second part of the discussion looks at what the year ahead has for SA consumers.
Mkhwanazi says the upcoming budget from treasury will likely set the pace for how local and international investors view SA.
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• Business Day Spotlight is a MultimediaLIVE production