The local economy continues to be in a depressed state and the trend is set to continue for some months to come. This is evident in the Reserve Bank’s composite leading business cycle.
The indicator fell for the 11th consecutive month in August on an annualised basis by 1.3%. On a monthly basis, it fell by 0.1% in August.
The composite leading indicator provides early signals of turning points in business cycles showing fluctuation of economic activity.
The largest negative contributions were a decrease in the export commodity price index, the Business Confidence Index and the average hours worked per factory worker.
Vacancies published by the Sunday Times are also low, indicative of the tough job market.
Composite leading business cycle indicator for South Africa’s major trading-partner countries is also down, which is another sign of tough market conditions.
The largest positive contributions came from an increase in the number of residential building plans approved. The number of new passenger vehicles sold as well as the volume of orders in manufacturing also contributed positively.
