South Africa recorded a trade deficit of R2,299-billion for its trade with non-Southern African Customs Union trading partners in June after a deficit of R76,4-million in May and a surprise R3,121-billion deficit in April, according to the latest Customs and Excise figures released on Friday.
The median forecast was for a consensus of a R2-billion surplus, with the range from a deficit of R1-billion to a surplus of R4-billion.
Shrireen Darmalingam, economist at Standard Bank, said: “This is a bit disappointing as the market consensus was a surplus, and I in fact expected a R1-billion deficit. Going forward, I think we’ll see some trade deficit coming in, particularly in July on the back of a stronger rand.”
Commented Colen Garrow, economist at Brait: “This is not a good figure at all. It suggests a broad trend on the current account and the rand.”
Magan Mistry, economist at Nedcor, said: “The monthly trade figure is very volatile. For the first six months the trade account now has a deficit of R1,6-billion and for the first half of the year the current account has run into a deficit of about R15-billion or close to 2% of gross domestic product.
“At some point, the currency market will focus on the deficit and this should result in a softening of the rand. Year-on-year the value of exports has only increased by 2%, while imports have climbed by 13%. A current account deficit of 2% of GDP [gross domestic product] is manageable, but a deficit of more than 2,5% isn’t.”
“The figure is worse than I expected,” said George Glynos, market analyst at Econometrix Treasury Management. “Although the warship was the main factor — still, without it we would have had a deficit. The effects of a stronger rand are now coming into effect.”