The South African Chamber of Commerce and Industry (Sacci) business confidence index (BCI) improved by one index point in July to measure 94.7, compared with 93.7 in June.
However, the BCI remained 0.6 index points below the 95.3 of July 2017. “Whereas the downward momentum of the BCI slowed in June, it made a marginal upward turnaround in July,” Sacci stated.
The business climate benefited from subindices reflecting both real economic activity and the financial surroundings. Only two of the seven real-activity subindices had negative month-on-month influences, and two of the six financial subindices had negative month-on-month effects on the BCI in July.
Sacci said the biggest positive month-on-month influence on the BCI in July were merchandise export volumes, lower inflation and real retail sales.
Merchandise import volume, the decline in dollar metal prices and the number of new vehicles sold, made the largest negative month-on-month impact on the BCI.
“Although there are still major economic challenges facing South Africa, it appears the downward trend in the business climate since February 2018, has lost its momentum and confidence could turn more positive. This mainly depends on the removal of economic policy uncertainties and the nurturing of all global economic relations for the benefit of South Africa and all its people.
“Apart from the economic challenges, it is important to have a stable socio-political environment that enhances economic performance and business confidence,” stated Sacci.