economy
economy

The Rand Merchant Bank (RMB) on Monday said the South African’s economy will grow this year because of favorable domestic and international factors.

“We are hopeful that the South African economy can do better in 2018 given the good global environment and the better domestic political situation,” said John Cairns, RMB’s currency strategist.

He stated that the local currency, rand has remained strong. Cairns said the first two weeks of 2018 have seen a surge in equity and commodity markets, an upward push in bond yields and the dollar pushing to a three-year low.

He added, “This is a great environment for risk currencies which have mostly been surging. The global economy looks set for a good year — there is a strong consensus that 2018 will see robust synchronized global growth, with low inflation and only moderate rate hikes from the Fed.”

Rand Merchant Bank analyst Gordon Kerr said while the country’s December’s political developments are slowly waning, headlines around reforms still keep coming up.

South Africa’s ruling party, African National Congress (ANC) held its elective congress last December and that had been bringing uncertainty in the country.

Kerr said the metals and energy continue to perform well and the dollar is under pressure. He said the global environment remains very supportive with risk assets performing well and stocks edging higher.

“Both the local and global environments are thus providing a great platform for the rand and bonds to hold onto their December gains,” he said.

The South African Finance Minister Malusi Gigaba said last Thursday the country’s economy may grow by 2 percent this year if his government takes needed policy decisions. Enditem

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