Persistent load shedding, high interest rates, and a weaker rand due to diplomatic relations have hit South Africa’s business confidence hard, with optimism nosediving in the consumer-facing new vehicle and retail sectors.
The first quarter survey was conducted between 10 and 30 May, covering 1,050 senior executives in the building, manufacturing, retail, wholesale, and motor trade sectors.The gloomy sentiment was shared among respondents, with three of the five sectors seeing their confidence level decline while the other two remained unchanged.
The bureau also noted that some respondents mentioned the weak rand exchange rate and concerns about South Africa’s diplomatic relations with the rest of the world and its possible impact on trade relations. “However, some of the drivers of negative sentiments, such as strained geo-diplomacy, could be resolved in the coming months, while current constraints on business conditions, such as load shedding, could look somewhat better in 2024 and may support an improvement in confidence over time,” added the BER.
According to the index, Sales volumes in non-durable goods struggled the most. In contrast, Semi-durable goods retailers did see a slight uptick in volume growth.
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