Sentiment unsteady in South Africa

18 November 2011

JOHANNESBURG: Consumer confidence remains in flux in South Africa, one of the region's most important markets, as the challenging global economic situation impacts popular sentiment.

The regular index produced by the First National Bank and Bureau for Economic Research climbed to a total of +5 points for Q4 2011, measured against a total of +4 points in Q3 2011.

A slightly higher proportion of the panel anticipated seeing an improvement in their household finances going forward, and their willingness to purchase durable goods also improved.

Despite this, the public mood remains unsettled: "The one index point change is so small that for all practical purposes one could say that consumer confidence remained unchanged," the report said.

Moreover, the total recorded during the third quarter of this year actually marked a contraction of seven points from Q2 2011, although it does remain above the long term average of +2 points.

Pessimism about the domestic economy became more widespread, largely due to the Eurozone crisis, inflation and sharp fall in the value of the Rand.

More specifically, white consumers logged an overall confidence rating of –5 points, an increase of five points quarter on quarter. Black consumers posted +12 points, the same scores as the last research round.

High-earning consumers with salaries of more than R10,000 ($1,224) per month and their lower middle income counterparts on between R2,000 and R5,000 a month saw sentiment harden.

However, their peers taking home earnings in the R5,000 to R10,000 became more pessimistic.

Data sourced from First National Bank; additional content by Warc staff