Current account deficit narrows as imports slip

7th December 2023 By: Bloomberg

Current account deficit narrows as imports slip

South Africa’s current account deficit shrank by much more than expected in the third quarter, buoyed by a surge in the trade balance as the volume of imports fell.

The deficit on the current account, the broadest measure of trade in goods and services, shrank to an annualised 0.3% of gross domestic product, or R19.3-billion, from a revised 2.7% of GDP in the prior quarter, the South African Reserve Bank said in a statement Thursday.

The consensus of nine economists in a Bloomberg survey was for a deficit of 1% of GDP. South Africa has now posted a current-account shortfall for a sixth straight quarter.

The trade surplus widened to 189.1 billion rand in the third quarter from R22.2-billion as the value of merchandise imports decreased more than that of goods exports, the central bank said. The drop in import values was due to lower volumes, it said.