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29 Feb 2008 14:29
South Africa’s monthly trade deficit widened to R10,2-billion in January, compared with December’s R1,2-billion gap, the South African Revenue Service said on Friday.
Compared with the previous month, exports fell by 8% while imports increased by 13%, largely due to a rise in imports of minerals products and machinery.
The deficit was down on the R11,94-billion shortfall recorded in January 2007.
Fanie Joubert, economist at Efficient Group, said: “It is slightly larger than expected, but it may be biased because of the electricity crisis during January. It also confirms it will be a while before we get surplus.”
Economist Mike Schussler of T-Sec said: “This number is certainly going to be the nail in the coffin for the rand.
The rand has already weakened, and it has become ever clearer that interest rates are likely to hike.
“We have a huge problem, this has been a very bad week with the inflation data that has come in so far, as well as PSCE [credit extension to the private sector], which indicates that we are going to have another interest rate hike.
“I’m afraid to say that we have been right on the inflation outlook for the last 18 months, and this trade balance is not good for the rand.”—Reuters, I-Net Bridge
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