The Beating of the Rand continues
South Africa’s currency has been caught in a brutal pincer of dependence on weak European markets, exposure to slowing emerging markets, domestic turmoil and tighter US monetary policy. The Federal Reserve’s announcement on May 22 that it would eventually roll back stimulus was another gust of wind amid a cyclone for the South African rand. Like other emerging market currencies, the South African unit has had a torrid time of late. In January the currency stood at 8.75 rand to the dollar. On Thursday it hit a four-year low of 10.44, with little sign of an increase in exports that you might expect to see with a weaker currency.
“Since the beginning of the year, you will find that the rand, like the real of Brazil or the rupee of India,…
Food Price Hikes hit Consumers hard
South African consumers’ grocery costs are increasing at almost three times the rate of inflation. Consumers are spending more and more money on essentials due to the consistent rising costs of consumer goods and services. The spending patterns of clients on essential needs, such as food expenses, petrol and travel expenses, in relation to their income have drastically increased. Most high-income clients – those earning R20 000 and above – suffered a 14.1% increase in food expenses in the past nine months. Statistics SA said on Wednesday the consumer price index (CPI) annual inflation rate for all urban areas increased to 6.3% in July alone.
The CPI measures changes in the price level of consumer goods and services and exceeded the pr…
Domestic Spending on Record High
BankservAfrica’s Economic Transaction Index (BETI) shows a record number of consumer transactions for July. “The BETI reflects 84.2 million transactions for the month of July, which is the highest number of transactions in the life of this index so far,” said BankservAfrica regulated products CEO Brad Gillis. “While one ray of sunshine does not make a summer, the fact remains that the BETI has now seen improvements, in real terms, in five out of the last seven months of 2013.” The year-on-year increase for July was 3.9%, up from 2.8% in June.
Chief economist for economists.co.za, Mike Schussler, said the latest index indicated that third quarter gross domestic product figures were also likely to be stronger than predicted. "Although s…
AMCU pushes Inflation with Wage Demands
The Association of Mineworkers and Construction Union (AMCU) will demand a monthly pay of R12,500 for mineworkers, its leader said on Friday. “The struggle for a living wage continues. We are demanding R12,500 in gold and platinum sectors,” Joseph Mathunjwa said in Marikana, North West. If the demand was not met his union would call for a strike that would cripple the economy. “The strike will stall the economy of the country to an extent that the government and mining companies will be forced to find a way to meet the demands,” he said at a commemoration marking the first anniversary of the Marikana shootings.
Thirty-four miners were killed on August 16 when police fired on them while trying to disperse and disarm them. Ten people we…
CAPITEC first to extend Banking Hours in Malls
A Capitec spokesperson says the bank has decided to extended its banking hours at a selected branch located in malls as an experiment. Carl Fischer, Capitec’s head of marketing and corporate affairs, said: “We know how much our clients appreciate being able to do their banking after 17:00 on a Sunday and now we’re supporting those who find it difficult to visit a branch during office hours. “This is specifically the case with people who are also in the service industry and don’t have the freedom to slip away during the day.” If the new service proves popular among clients, the bank will roll it out to select branches located in malls in other areas across the country. A total of 160 Capitec’s 580 branches are located in shopping centres…
Unemployment at 25.6% - Record High since 2008
South Africa – sadly – had to publish a new negative record yesterday as the recorded number of South Africans without a job rose to 4.723 million in the second quarter of 2013. It is now the highest since the Statistic Office (STATSA) started the survey in 2008. Thus the country’s unemployment rose to 25.6% of the labour force compared with 25.2% in the first quarter. Stats SA said this amounted to 4.7 million people without work in the second quarter, up from 4.6 million jobless in the previous three months.
Compared to a year ago, unemployment in the second quarter of this year had increased by 5.7%. The country’s unemployment rate has been stuck around 25% for the past several years and is one of the biggest headaches for Presiden…
Julius Malema's Party takes off as expected
The new political party founded by Julius Malema, the Economic Freedom Fighters (EFF), says it has secured over 1 000 new members. “We received 1 100 new members on the first day of recruiting,” said party leader Malema at a media briefing in Soweto. “If this becomes a trend then we will be getting 1 000 member[s] every day…it’s going to be bigger than what we expected.” This exceeded their expectations, he said.
The EFF – which had gathered in Soweto for a two day national assembly – plans to contest next year’s general election. Malema said the EFF would be officially registered with the Independent Electoral Commission (IEC) tomorrow after a few amendments had been made, including changes to its logo. The EFF logo depicted an arr…
Repo Rate remains unchanged at 5%
The South African Reserve Bank (SARB) was not ready for another surprise move like last July and kept the interest rates on the same level. The repo rate, the interest rate at which the Reserve Bank lends money to commercial banks, remains on its 40-year low of 5%, which translates to a prime lending rate of 8,5% per annum. The Monetary Policy Committee (MPC) continues to face conflicting policy choices relating to rising inflation and slowing growth. Despite the upward trend in core inflation, there are no strong signs of excess demand pressures and the forecast for headline inflation suggests that the breach of the target may be short-lived. Inflation is now expected to average 0.1% and 0.3 percentage points higher in 2013 and 2014, …
Happy Birthday, Tata Madiba
Birthday wishes were pouring in for former president Nelson Mandela as he turned 95 on Thursday, with a tangible sense of celebration in the country as millions of pupils sang “Happy Birthday Madiba” and South Africans from all walks of life geared up to pay tribute to their national treasure. In 2010, the United Nations General Assembly declared July 18 as Nelson Mandela International Day, in honour of Mandela’s lifelong commitment to human rights, conflict resolution and reconciliation. South Africans and people around the world have been called on to observe the day by giving at least 67 minutes of their time to help create a better tomorrow for all.
EU - SA Summit focussing on easier Trade, Growth & Employment
South Africa will push for greater flexibility on agricultural exports to Europe in the upcoming SA-EU summit, Trade and Industry Minister Rob Davies said on Tuesday. “There are still some outstanding matters of give and take,” Davies told reporters in Pretoria. He was speaking ahead of the 6th South Africa-European Union summit in Pretoria on Thursday.
The South African delegation will be led by President Jacob Zuma, who will meet European Council president Herman van Rompuy and EU Commission head Jose Manuel Barroso. Davies said he was confident the talks would prove fruitful, but said there were some delicate trade subjects up for discussion.
Outlining the trade relationship between South Africa and the EU bloc, he said the le…