Global trade fortunes diverge, but China s share of t dailymaverick.co.za - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from dailymaverick.co.za Daily Mail and Mail on Sunday newspapers.
Buoyant global trade and record-high commodity prices continue to underpin SA’s healthy trade balances. But the government cannot rely on this as its sole source of economic dynamism.
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Absa CIB economists outline possible scenarios for SA going forward. Image: Mike Hutchings, Reuters
A discussion on the outlook for SA’s economy by economists at Absa Corporate and Investment Bank has painted a largely positive picture with stronger economic growth, a stronger exchange rate, low inflation and no increase in interest rates. Unfortunately, the researchers added a huge ‘but’ to their rather optimistic views.
âUncertainty is high. That outcomes can differ from our baseline (forecast) are not just possible, but reasonably plausible,â warn the researchers, leading them to add both more positive and more negative scenarios to their rather optimistic forecast.
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The bank says the SA Reserve Bank has no pressure to tighten its monetary policy.
But the record-low interest rates are still not boosting banks lending activities.
Absa expects interest rates to remain at current record lows at least for the next 12 months.
Absa, which presented its economic outlook for the second quarter on Wednesday, said the SA Reserve Bank (SARB) has no reason to hike interest rates since there are no inflationary pressures and no pressing fiscal risks.
Absa Group senior economist Peter Worthington said he didn t foresee a repo rate hike until March 2022. The banking group forecasts a 25 basis points hike then, and the prime lending rate to remain below 2019 levels by the end of 2023 at 8.25%.
Salga wants a 2.8% salary increase for municipalities across SA
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Cape Town - The South African Local Government Association (Salga) has proposed a 2.8% salary increase for the 2021 salary and wage negotiations at the SA Local Government Bargaining Council (SALGBC).
The proposal comes against the backdrop of the national government’s intention to offer 0% to national and provincial government workers.
Last week representatives from different public sector unions warned that a strike is likely unless the government concedes to their wage demands that they have tabled in the bargaining council for the year.
Salga argues that municipalities are facing severe financial constraints as national government transfers have been cut and local taxpayer arrears rise.