Thursday 5th April 2018
SACCI today released the March 2018 SACCI Business Confidence Index (BCI) at its Offices in Rosebank, Johannesburg.
The SACCI Business Confidence Index (BCI) was still 3.8 index points above the BCI level of March 2017 but declined by 1.3 index points from 98.9 in February 2018 to 97.6 in March 2018. It is now five months since November 2017 that the BCI kept to levels above 95. The BCI on average measured 98.7 in the 1st quarter of 2018 compared to 95.7 in the 1st quarter of 2017 and 94.8 in the 4th quarter of 2017.
The improved business mood is still present but a need appears to be backed up by an improvement in the real economy and further improving financial conditions. The direction of most of the business climate indicators is still positive, but the momentum appears to have slowed. The positive investor tendency of the 4th quarter of 2017 should continue to augment the present business climate.
Three of the thirteen sub-indices that make up the composite SACCI BCI had a positive monthly impact in March 2018; four sub-indices were unchanged, and six were negative month-on- month. Increased merchandise export volumes, lower real financing cost and lower consumer inflation made the largest positive monthly contributions to the business climate. Less merchandise import volumes, lower real retail sales growth and subdued real value of building plans made the most notable negative monthly contributions in March 2016 to the business climate.
The continued year-on-year improvement of the BCI in March 2018 was the result of eight of the thirteen sub-indices that improved and two that were unmoved. One of the six financial sub-indices had an annual negative impact on the BCI while two activity sub-indices had negativeannual effects on the BCI in March 2018. The largest positive annual contributions to the business climate were from lower inflation, increased merchandise import volumes and new vehicle sales.
The business and economic climate remained favourable in the first few months of 2018 and there was a serious attempt to eradicate the most obvious maladministration and financial mismanagement in the public sector. More certainty has to be obtained to bring fixed investment and the economy onto a healthy platform for growth.
Although there is greater hope for economic policy certainty and a pivotal role for the business, the current positive climate and momentum of business confidence should be supplemented by tangible results.
For a full background to this month’s SACCI BCI see the Economic Commentary in the BCI report on www.sacci.org.za.
For more information, contact:
Alan Mukoki SACCI CEO 011 446 3800
Richard Downing SACCI Economist 082 822 5566