South Africa business confidence hits 2-1/2 year high in January

A street money changer counts South African Rands in Harare, Zimbabwe, May 5, 2016. REUTERS/Philimon Bulawayo

JOHANNESBURG (Reuters) – South Africa’s business confidence rose for a third month in a row in January to its highest since late 2015, on expectations that the new leadership of the ruling party will stabilise economic policy, a survey showed on Tuesday
The South African Chamber of Commerce and Industry’s (SACCI) monthly business confidence index rose to 99.7 in January from 96.4 in December.

Increases in import volumes, a stronger currency and higher retail sales volumes all boosted sentiment, the business body said.

“There is the expectation that new leadership will lead to more promising and consistent business and economic policy options,” economists at SACCI said in a statement.

The rand is trading at its strongest in three years, advancing about 20 percent since November. Most of those gains came after businessman Cyril Ramaphosa was elected president of the ruling African National Congress in December.

The continent’s most industrialised economy sank into recession in the first quarter of 2017 before recovering, but investor and consumer confidence have remained subdued due to political and policy uncertainty linked to President Jacob Zuma.

But measures of purchasing manager activity and consumer confidence, as well as the central bank’s forward indicators have shown economic activity ticking-up as pressure on Zuma to quit has mounted.

Reporting by Mfuneko Toyana; Editing by Alexander Winning and Andrew Heavens

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