The most closely watched numbers in the Reserve Bank’s quarterly bulletin tend to be the balance of payments figures, which can drive the rand exchange rate up or down because of what the numbers imply for how much foreign financing SA needs — and how much it is getting. A key number is the deficit on the current account of the balance of payments, which reflects the balance on SA’s imports and exports of goods as well as service and income flows such as dividends, interest and tourism payments. SA has long run a current account deficit and depends on inflows of foreign capital to finance this. Since SA tends to receive relatively little foreign direct investment, it is dependent on more volatile portfolio inflows from international investors to keep the balance. The balance of payments numbers in the latest quarterly bulletin will disappoint many in the market who had been expecting a better outcome on the current account. The current account deficit has been falling lately, as muc...
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