|
|
|
|
|
|
| ||||
The Sun King gets a licence to gild his ... Gold plummets as Switzerland jumps ship... Stals comes out smelling of rose... Stealing the show with icons of the mode... British investors give SA airship compan... |
Stals comes out smelling of roses
THE ECONOMY
RESERVE Bank Governor Chris Stals appears to be the only one able to deliver on his Gear promises - the Finance Department is battling to contain government spending and proposals on a more flexible labour market have been conveniently forgotten as the Labour Department cosies up to Cosatu. So it is left to the Reserve Bank to take the unpopular decisions for longer-term success. This week Stals could claim a small victory when inflation fell to 8% in September from 8.7% in August - the lowest in over a year. Most economists predict a further decline over the next few months. Says Standard Bank, which expects a year-end rate of no more than 7%: "The outlook for consumer price inflation remains positive. Producer inflation continues to decline, this week's reduction in the bond rate should ensure a low monthly consumer price rise and the slowdown in economic growth should combine to moderate price increases." Standard expects the lower inflation rate to accommodate further reductions in interest rates during 1998. Conventional wisdom among economists foresees two percentage point cuts in the first half of next year. A breakdown of the consumer price index figures shows that food inflation at 8.3% in September declined sharply from 10% in August. Month-on-month, the overall CPI was up 0.4% and the food CPI by 0.3%. ý The good news on the inflation front was slightly offset by the poor performance of SA's trade account. September's trade surplus fell sharply to R144-million from R1.02-billion the previous month. Customs and Excise Department figures showed exports down to R11.35-billion from R11.84-billion last month, while imports rose 3.6% to R11.21-billion. Recent trade data has been rather volatile and a longer-term assessment gives a more positive picture: the cumulative trade surplus for the year to end-September has almost doubled to R9.7-billion from R4.9-billion over the same period in 1996.
|