July offered a welcome improvement in South African economic activity, but one month does not yet signal a sustained economic turnaround.
South Africa’s economic activity picked up in July after two consecutive months of decline, offering a small but welcome sign of resilience in an economy that has struggled to build sustained momentum.
The PayInc Economic Index increased in July, albeit by a marginal 0.3%, following declines of 2% in May and 0.9% in June and is now almost a full percentage point higher than a year ago.
The improvement coincided with the first notable decline in petrol and diesel prices in several months, after substantial increases earlier in the year.
“Fuel prices have emerged as an important driver of economic activity in recent months, given their direct impact on household budgets and business operating costs,” says Elize Kruger, an independent economist.
