Consumer confidence in South Africa in the first quarter of the year was at its highest level ever in the 24-year existence of the composite consumer-confidence index (CCI), First National Bank (FNB) announced on Thursday.
FNB and Stellenbosch University’s Bureau for Economic Research (BER) measure the trends reflected in the CCI, which increased a percentage point from +20 in the last quarter of 2005 to +21 in the first quarter of 2006.
”What makes the current record unique is the fact that the FNB/BER CCI has never before, in its close to a quarter-of-a-century history, remained at such a high level for such a long uninterrupted period,” said FNB chief economist and index spokesperson, Cees Bruggemans.
The CCI’s previous highest point was +20 during the last quarter of 2005 and the second quarter of 2004, when it spiked after South Africa won the bid to host the 2010 Soccer World Cup.
Bruggemans said the index had moved to a higher level instead of falling sharply as it had always done in the past and had remained at a higher level for five consecutive quarters.
”This seems to suggest a sustained, long economic expansion,” he said.
Factors contributing to the increase in the year’s first quarter included Minister of Finance Trevor Manuel’s well-received National Budget in February, personal income-tax cuts and public delivery intentions.
Furthermore, said Bruggemans, nearly all commentators forecast no interest rate changes in 2006. — Sapa