Household finances are expected to deteriorate further in the second quarter of this year, reflecting the temporary surge in inflation, before improving in the second half of the year.
Household finances deteriorated in the first quarter of this year, as real personal disposable income (PDI) growth slowed, employment decreased, and net wealth moderated.
Growth in real PDI slowed from 1% quarter-on-quarter in Q1 to 0.8% in Q4. Compensation of employees (COE) rose by 2.2%, accelerating from 0.5% previously. However, this was said to be offset by a sharp (4.2% qoq) contraction in other income, says the Nedbank Economics Unit.
The decline in other income (profits, rents, interest, and dividends) resulted from a deterioration in global equities when the US launched a war against Iran towards the end of February, says the bank's economists Johannes Khosa and Nicky Weimar.
This is evident in a recent comparative assessment of municipal development costs across KwaDukuza, eThekwini Metropolitan Municipality, Mbombela Local Municipality and Stellenbosch Local Municipality, which reveals clear and material differences in cost competitiveness, driven primarily by property rates, service charges and key development-related fees.
