Latest news with #LaraHodes
Reuters
01-07-2025
- Business
- Reuters
South African rand stable before manufacturing PMI and car sales figures
JOHANNESBURG, July 1 (Reuters) - The South African rand was stable in early trade on Tuesday, before the release of a purchasing managers' index (PMI) survey for the local manufacturing sector and vehicle sales data. At 0557 GMT the rand traded at 17.69 against the dollar , a whisker away from Monday's close. The Absa PMI for June is set to be released at 0900 GMT and will shed light on manufacturing conditions in Africa's most industrialised economy. Investec economist Lara Hodes said in a research note that she expects the manufacturing index to have remained in contractionary territory in June. This would be a reflection of "a lacklustre domestic economy which continues to face a number of structural challenges, while globally manufacturing conditions remain subdued weighing on export potential," she added. Local investors will then turn their focus to vehicle sales (ZAVEHY=ECI), opens new tab data for the same month due around 1200 GMT, giving a snapshot of consumer demand for big-ticket items. Nedbank economists forecast an annual growth in car sales, mainly reflecting last year's low base and easing financial conditions due to interest rate cuts, lower debt service costs and subdued prices. The dollar last traded flat against a basket of currencies as uncertainty over U.S. President Donald Trump's tariff policies ahead of the July 9 deadline heightened. Tariff rates ranging from 10% to 50%, announced on April 2, are scheduled to take effect next week following a 90-day pause implemented by Trump, unless bilateral trade deals are reached. South Africa's benchmark 2035 government bond was slightly stronger in early deals, as the yield fell 3 basis points to 9.935%.
IOL News
24-06-2025
- Business
- IOL News
South Africa's tourism jobs at risk as foreign arrivals decline
Despite a rise in accommodation spending, South Africa faces a worrying decline in international visitors. Image: Pexels/Nappy Although tourists spent more on accommodation in April when compared with a year ago, the volume of international visitors to our shores declined in May when compared to the previous month. Lara Hodes, Investec economist, said in a note that she expects the June figures to likely be lower due to 'an escalation in geopolitical tensions'. On Tuesday, Statistics South Africa's figures showed that overall tourism to and from international destinations, both by local and global tourists, declined 3.4% in May when compared with April – although this figure was up 22.2% year-on-year. 'Despite current challenges, however, the domestic tourism sector remains a key conduit for growth and employment and is a significant focus area of government. One of the priorities of Operation Vulindlela Phase II launched last month is to streamline the visa system to increase tourism and attract investment,' said Hodes. South Africa's tourism sector employs around 1.5 million people both directly and indirectly. The agency also noted that a comparison between the movements in April 2025 and May 2025 indicates that the volume of arrivals decreased for South African residents but increased for foreign travellers. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad Loading In terms of money spent on accommodation while in South Africa, there was a 14.8% year-on-year increase in income in April. This was mostly driven by a category called 'other' – up 21.2% - and hotels, which gained 11.1%. This 'other' category includes lodges, bed-and-breakfast establishments, and self-catering establishments. Statistics South Africa said in its Tuesday print that the gain was also the result of a 4.5% increase in the number of stay unit nights sold and a 9.9% increase in the average income per stay unit night sold. The gain on income, which strips out restaurant and bar sales, followed a 5.7% year-on-year increase in March, Hodes noted. Hodes added that, when measured on a quarter on quarter seasonally adjusted basis in real terms however, income from accommodation declined in April. She pointed to the most recent Bureau for Economic Research (BER) Other Services survey, which showed that confidence among respondents in the hotel and restaurant subsector decreased markedly in the second quarter of the year alongside significant declines in both business conditions and business volumes. IOL Business
IOL News
18-06-2025
- Business
- IOL News
Soaring living costs add over R21,000 a year to household bills
Statistics South Africa's latest inflation publication, for the May 2025 period, shows that the consumer price index was 2.8% on a yearly basis last month. This compares well with a year ago, when it was 5.2%. However, inflation compounds and items keep going up every month. Image: Kampus Production Even though the increase in the cost of living has slowed substantially over the past year, declining by 2.4 percentage points year-on-year, your average monthly bills will still, in theory, have increased 2.6% between last May and now – adding R21 000 to bills over a year. However, Numbeo figures show that Johannesburg is among the cheapest cities in which to live, with only Delhi (India) and Rio de Janeiro in Brazil having a lower index. Statistics South Africa's latest inflation publication, for the May 2025 period, shows that the consumer price index was 2.8% on a yearly basis last month. This compares well with a year ago, when it was 5.2%. However, inflation compounds and items keep going up every month. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Based on a basket of goods the average South African may be spending their money on each month, and taking compounding into account against the base price, every day items will have cost R1 808 more than a year ago. The figures were worked out using a nifty inflation adjustment calculator. This is based on the most recent prices for this year, so it doesn't take cost variations into account. Even without historical price data on items such as DSTV Compact Plus not being readily available, the increase amounts to R21 702 over the year. And that's allowing for lower price hikes of one item offsetting the increase in others somewhat. It's worse if you smoke or drink – those items on average went up year-on-year by 4.3%. If your weekend party stash of drink cost R1 000 last May, it went up by R43. That, based on advertisements from liquor stores, is worth almost half the cost of a six pack of beer. Investec economist Lara Hodes breaks down the contributors to May's inflation print. 'Within the food basket, meat price inflation, which holds the highest weighting rose to 4.4% year-on-year from 3% year-on-year in April,' she wrote in a note. Moreover, Hodes wrote, oils and fats prices increased 5.6% year-on-year, while the price of fruits, nuts, and vegetables jumped between 10.3% and 13.5% year-on-year. The good news is that the rate of increase in the cost of living was in line with economist's consensus. IOL
IOL News
11-06-2025
- Business
- IOL News
Manufacturing in dire straits as production plummets 6. 3% year-on-year
The manufacturing sector's poor performance aligns with the Absa Purchasing Managers' Index, which moved further into contractionary territory in April Image: Supplied South Africa's manufacturing production nosedived 6.3% year-on-year in April 2025, worse than economists had expected, although in line with a global slowdown in the production side of most economies. Statistics South Africa released data that showed that food and beverages were hardest hit as a subsector, declining 7.6% and slicing off 1.8 percentage points from the headline figure. This follows an already unfavourable performance in the first quarter, where manufacturing dragged down gross domestic product. Manufacturing was, at one point, considered the backbone of the country's industrialisation efforts and a critical employer of semi-skilled workers. The sector, which accounts for about 14% of GDP, employs about 1.6 million South Africans. Basic iron and steel, non-ferrous metal products, metal products and machinery's decline resulted in a negative contribution of 1.4 percentage points, while the motor vehicles, parts and accessories and other transport equipment sector slumped a staggering 13%, removing another 1.2 percentage points. The petroleum, chemical products, rubber and plastic products division also contracted by 4.7%, further dragging down the overall figure by an additional percentage point. While there was a slight month-on-month increase of 1.9% in April compared to March, the three-month trend shows a 1.4% decrease, with seven out of ten manufacturing divisions reporting negative growth. Investec economist Lara Hodes described the decline as "notable" and worse than a Bloomberg consensus expectation of a 4.5% year-on-year drop. "The decline was broad based, with all sectors except the glass and non-metallic mineral products grouping declining year-on-year," she said. She highlighted that within the food and beverages segment, the beverages and other foods sub-categories were largely responsible for the notable decline. The manufacturing sector's poor performance aligns with the Absa Purchasing Managers' Index, which moved further into contractionary territory in April, said Hodes. Citing the Bureau for Economic Research, Hodes added that 'the index tracking export sales returned to contractionary levels'. Thanda Sithole, FNB senior economist, said 'Operating conditions for domestic manufacturers remain unfavourable'. Statistics South Africa's figures show a picture similar to that of the rest of the world, with Hodes noting that "manufacturing operating conditions globally deteriorated for the first time in four months in April," citing the JP Morgan Global Manufacturing PMI survey. New orders decreased, trade conditions worsened, jobs were cut, and business optimism slumped, JP Morgan found. IOL
IOL News
06-06-2025
- Business
- IOL News
South Africa's exports face decline amid economic challenges
All indications were that exports are set to slow given the current economic climate, recent indicators, as well as surveys showing that manufacturing operating conditions are deteriorating. Image: Supplied All indications were that exports are set to slow given the current economic climate, recent indicators, as well as surveys showing that manufacturing operating conditions are deteriorating. This is according to Investec economist, Lara Hodes, who said that the trade account surplus was likely to decrease further. On Thursday, the South African Reserve Bank (SARB) said that South Africa imported more than it exported during the first quarter of the year, although the country benefitted from the rand price of exported goods and services increasing more than that of imports when it comes to terms of trade. Hodes noted that a pending decline in exports ahead was based on data such as the Absa Manufacturing Purchasing Managers' Index (PMI) for April, which noted that the data tracking export sales returned to contractionary levels. In addition, according to the results of the JP Morgan Global Manufacturing PMI survey, global 'manufacturing operating conditions deteriorated' in April, with 'new export orders suffering its steepest decrease since August 2023,' Hodes said. She also noted that survey data from JP Morgan provided evidence of further potential weakness. Hodes said that globally, heightened levels of uncertainty around tariffs persist. S&P Global, she said, has indicated that the damage to confidence stemming from the radical shift in US trade policy, along with its unpredictability, is likely to linger, which will weigh on trade and growth prospects. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Trade balance trend Image: SARS/Investec The central bank said in its release that South Africa's trade surplus narrowed slightly by R5.2 billion as the value of merchandise imports increased more than that of goods exports. 'The increase in the value of imports and exports of goods and services in the first quarter of 2025 reflected both higher volumes and prices,' the central bank explained. It added that the current account deficit as a ratio of gross domestic product (GDP) remained broadly the same at 0.5% from the fourth quarter of 2024 to the first quarter of 2025. However, the agency noted that 'South Africa's terms of trade, including gold, improved in the first quarter of 2025 as the rand price of exported goods and services increased more than that of imports'. IOL
