South Africa’s trade balance improved dramatically from a revised R5.27bn deficit in November to a R6.8bn surplus in December. This improvement is largely due to the lower oil price and fuels optimism that the benefit may help narrow the current account deficit this year.
Kagiso purchasing managers index (PMI) rose four points to 54.2 last month, supported by a pick-up in business activity, new sales orders and seasonal factors. Exports of locally built cars shot up 84.4% last month, compared to January last year.
Eskom, the country’s electricity supplier, may very well limit the positive effect of lower oil prices as load shedding continues to cripple production in the country. It is expected to take more than 5 000MW out of service on planned maintenance, which will likely hurt local businesses.
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