Economic activity ticked up in July after anaemic showings in May and June, helped in part by lower fuel prices during the month as oil markets reacted to renewed hopes for peace in the US-Iran conflict.The PayInc economic index edged up 0.3% to 102.7% in July compared with June, reflecting a year-on-year gain of 0.9%. July was the first month in which petrol and diesel prices dropped notably at local pumps as oil markets reacted positively to the signing of a perceived peace framework between the US and Iran in mid-June, Africa’s leading automated clearing house PayInc said. Given the extent of the fuel price increases over the past few months, it has become a definitive driver of economic activity.“July’s lower fuel prices provided some welcome relief and coincided with an improvement in economic activity. However, continued volatility means the outlook remains uncertain,” said independent economist Elize Kruger.“Continued geopolitical uncertainty and volatility remain a risk to business and consumer confidence, with households and businesses likely to remain cautious about spending, investment and hiring decisions.”The economic index reflects the value of all electronic transactions cleared monthly through PayInc, the country’s primary payment utility, and wholesale cash demand in the economy, at seasonally adjusted real prices. The number of transactions processed through the clearing house reached an all-time high of 201.5-million in July from 186.8-million in June, representing an increase of 13.5% over a year ago.The nominal value of electronic transactions increased to R1.521-trillion in July compared with R1.427-trillion in June, reflecting the growing preference for electronic payments.The report was published a day after Statistics South Africa data showed the economy is not growing enough to create much-needed jobs, with the unemployment rate jumping to a four-year high of 33.6% in the second quarter from 32.7% in the first three months of 2026. Unemployment among young people aged 15 to 34 was more dire at 47.4%.The jobs numbers were a stark reminder that an unfavourable economic environment, characterised by higher input costs straining profitability, higher interest rates and declining confidence levels, spills over to the labour market, PayInc said on Wednesday.However, the slightly firmer July economic index added to other recent pointers to some resilience during the month.S&P Global’s private sector-wide purchasing managers’ index (PMI), a weighted average of new orders, output, employment, suppliers’ delivery times and stocks of purchases, was at 50.3 in July. While lower than the previous 50.5, readings above 50 signal an improvement in business conditions from the previous month, while those below 50 show a deterioration.Absa’s manufacturing sector PMI dipped slightly to 46.8 in July from 47.3, but underlying indicators were more positive, with improvements in new sales orders and business activity, alongside easing supply-chain delays and moderating input costs.“July offered a welcome improvement, but one month does not yet signal a sustained turnaround,” Kruger said.“A more meaningful recovery will depend on greater stability, easing cost pressures and an improvement in confidence that encourages households to spend and businesses to invest and create jobs.”Business Day