ECONOMY: FNB Economics Weekly
Recent Gauteng Business News
·SA: SA GDP rebounded strongly in 2Q16, accelerating by 3.3% q/q saar from a 1.2% contraction in 1Q.
·Global: US Nonfarm payroll employment revealed that the US added 151,000 jobs in August, although down from 275,000 in July. Data in the UK positively surprised as the services PMI rebounded sharply, surging to 52.9 in August from 47.4 in July and industrial production edged up 0.1% m/m. And as expected, the ECB left the policy rate unchanged at 0%.
The Week Ahead
The South Africa Reserve Bank will be releasing the 2Q16 Quarterly Bulletin next week. Needless to say a better than consensus current account outcome should be rand positive, provided things remain as they are. Our estimates suggest that the current account deficit should have narrowed to -2.5% of GDP thanks to an improvement of the trade balance. However, net services and transfers pose risk to our forecast.
July retail sales are also scheduled for release next week. We anticipate a continuation of the muted growth reported in June (forecasting 1.6% y/y growth) as the impact of higher inflation, rising rates and weak household credit demand take hold.
Business News Sector Tags: Economy|