Preview: May trade balance seen at -R5,7bn
FMCG SUPPLIER NEWS
Business Live - Jun 25th 2012, 08:02
South Africa’s foreign trade balance with its non-Southern African Customs Union trading partners is expected to have recorded a R5,7bn deficit in May from a staggering R9,9bn deficit in April, according to an I-Net Bridge survey of leading economists.
Forecasts among the six economists surveyed ranged from a ten-billion-rand deficit to a R4,5bn deficit.
A deterioration of the trade balance does not bode well for the country’s current account.
The trade balance reached a deficit of R42,1bn in the first quarter, the Reserve Bank’s quarterly bulletin showed.
“If you look at the bulletin, you see that imports have increased drastically in the first quarter of this year and I expect that trend to continue.
“The rand is weaker but off its weakest levels so imports are still going to be a dynamic factor in trade,” said Efficient Group economist Merina Willemse.
Exports grew 13,5% in the 12 months leading up to April 2012 compared with the 12 months to April 2011, said Thabi Leoka, research strategist at Standard Bank.
Export growth slipped considerably in recent months, hit especially hard by the collapse in precious materials exports, said Ms Leoka.
Lower oil prices and stalling domestic demand growth were identified as factors that would likely keep the trade balance shortfall within sustainable limits, she said.
The Customs and Excise Department is set to release the latest foreign trade data at 2pm on Thursday, June 29.
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