Press release: For immediate release
Date: 10 February 2016
Almost no growth in SA economy this year
Economic transactions were up a mere 0.1% last month compared to January 2015 according to the BankservAfrica Economic Transaction Index (BETI), while quarter-on-quarter and month-on-month measurements are both down.
“The slowdown is now not only well established but most recent quarterly and monthly changes are indicating further declines are increasingly likely,” says Mike Schüssler, Chief Economist at Economists dotcoza. While it is certainly too early to say that South Africa is in recession, the number and value of transactions show a sustained slowdown over most of the last year and certainly also over the last few months, indicating that the economy is weak.
“This picture was possibly worsened by the month ending on a Sunday, meaning some month-end transactions may have been delayed to the beginning of February. But overall the BETI is still showing a declining trend,” says Schüssler.
While the previous months’ numbers were slightly more positive when compared to January 2016, a month-on-month decline was still evident. However, the speed of this decline increased steeply from -0.1% in December 2015 to -0.4% in January 2016.
Factors influencing the slowing economic activity include the weaker Rand, drought and a decline in foreign tourists. Declining new car sales and subdued manufacturing figures confirm the negative picture.
The last time changes were this weak was during the period of massive strikes in 2014. Interestingly, both credit and debit values last month grew below the rate of inflation.
“The number of transactions as captured by the BETI declined by 4.4% on a year ago, with a standardised value of R640.9 billion in nominal terms, which is 5.7% higher than in January 2015,” says Dr Caroline Belrose, Head of Knowledge and Risk Services at BankservAfrica
Contact Wendy Fourie for more information: firstname.lastname@example.org or (011) 497 4119
.Notes to the Editor:
The BETI stands for the BankservAfrica Economic Transaction Index. BankservAfrica is a payment enabling organisation operating between the various South African banks with a very secure messaging environment in place. Economists dotcoza is an economic consultancy that helped develop the BETI.
The BETI is a very fast and broad overview of current economic trends over a broad range of sectors, making use of economic transactions as captured by BankservAfrica. Like the Swift Index, the BETI is considered a “now-cast” number as a result of its speedy ability to convey the overall economic conditions to the market.
Where most economic indicators can take anything between 38 and 76 days to become public knowledge, now-cast indicators take less than a month after the facts were revealed to come to the market.
The BETI is also the broadest of the “now-cast” indicators to come to the market, as it covers economic transactions across the whole economy. Very big distortive economic transactions do not form part of the BETI. This is also on its own a trend-strengthening indicative factor.
BankservAfrica is a payment enabling organisation which sits between the various South African banks. The organisation has a very secure messaging environment in place.