07 May.
Absa: SA Morning Sheet.
This is a daily economic comment …
The sheets can be downloaded daily from Absa Economic Research
An extract from today’s sheet is provided as an example:
It is a busier week on the South African data calendar with the release of SARB’s gross gold and foreign exchange reserves (Tuesday), Stats SA’s Quarterly Labour Force Survey (QLFS) (Tuesday) and mining and manufacturing production figures (both released on Thursday). We are slightly above Bloomberg consensus forecasts in looking for gross reserves to have ticked marginally lower to USD50.57bn in April from USD50.68bn in March. Revaluation adjustments stemming from a weaker EUR and modest fall in the gold price in the month underpin our estimate. We think SARB, however, is likely to have taken further advantage of the stronger currency in the month to engage in more foreign exchange swap operations, which should help it to strengthen the country’s net reserve position.
Stats SA’s QLFS figures for Q1 are likely to reveal a more stable local labour market environment, though we point out that employment in the mining sector is unlikely to have fared particularly well given media reports of significant strike-induced employment cuts at one of the country’s largest platinum mines.
Perhaps the most critical data of the week will be mining and manufacturing production figures for March, which will provide some read-through into what these sectors contributed to Q1 GDP growth. As we highlighted in South Africa: February mining production plummets as PGM strike activity bites, our expectation that strike activity in SA’s platinum sector likely weighed further on overall production growth in March leaves us expecting momentum (q/q saar growth) in this sector to jump strongly into negative territory. This is likely to once again leave the mining sector as one of the largest drags on headline GDP growth in Q1 (figures released on 31 May).
Although we expect headline manufacturing production growth to have moderated to 3.2% y/y in March from 4.2% in February (as evidenced in lower PMIs, exports and vehicle sales in the month), we are relatively confident that the sector should contributed positively to Q1 GDP (on a 3m/3m saar basis production growth was sitting at 6.7% as at February). …
The sheets can be downloaded daily from Absa Economic Research
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