The Southern African Chamber of Commerce and Industry’s (Sacci’s) Business Confidence Index (BCI) increased by 0.4 index points month-on-month to 95.3 in July – the index’s highest levels since February.
Sacci noted that although the BCI continued to regain some lost ground after the March Cabinet reshuffle, business confidence remains relatively low and sensitive to political and uncertain economic policy positions.
“Deliberations on economic policy continue and some rogue statements by political role-players on policy positions adversely affected investor and business confidence. These utterances, although popular, may not support a vibrant and prosperous economy.
“It creates expectations that a stalling economy will not be able to fulfil,” Sacci noted on Tuesday.
It added that there were indications that economic growth in the second quarter may be “slightly positive”.
“The inflation rate is slowing down. The exchange rate is unstable but weak against the euro, the pound and the yen. The Reserve Bank unexpectedly decided to lower the repo rate by 0.25 percentage points, implying that prime lenders pay 0.25 percentage points less interest. All developments contributing to an improved backdrop,” it pointed out.