South Africa’s economy is expected to grow at a faster pace in the second quarter than economists forecast, according to a robust early economic scorecard for South Africa with a strong correlation to gross domestic product.
BankservAfrica Economic Transactions Index (BETI), which tracks interbank payments, climbed 3.9% in the second quarter from the first three months of the year.
Better-than-expected economic growth would boost tax revenue, helping rein in government debt and narrow the budget deficit at a faster rate.
“On a monthly basis, the index fell for the first time this year to 136.7 in June from a revised 143 in May because of increased power cuts and a significant rise in fuel and food prices, and the general inflation rate”, independent economist Elize Kruger said.
While continued power outages are likely to weigh on economic growth this quarter, the removal of all remaining Covid-19 regulations at the end of June may help counter that negative impact.
“A further recovery towards pre-Covid activity levels in some sectors where restrictions still applied will support general economic activity in the coming months,” said Kruger.