SA’s growth prospects looking bleaker by the day
The Reserve Bank’s leading indicator signals slower growth due to load-shedding, suppressed demand and low confidence
The Reserve Bank’s leading business cycle indicator, which contracted for a second consecutive month, paints a bleak picture of SA’s growth prospects — which look set to disappoint once again. After the economy failed to grow more than 1% in 2018, the data, released on Tuesday, suggests that any momentum has stalled. The leading indicator is based on monthly movements in various economic indicators, such as interest rate spreads, new passenger vehicles sold and job advertisements. It is watched closely as it moves in line with current economic growth — a drop in the indicator signals a risk of weak growth, or even contraction, for the economy. The leading indicator slipped into contractionary territory in December for the first time since July 2016. In January this year it fell 1.8%, reflecting current fragilities in the economy. The biggest blow came from further decelerations in the 12-month percentage changes in job advertisement space and in the number of new passenger vehicles ...
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