Despite the resilience of the global economy and a notable depreciation in the rand exchange rate, SA exporters were unable to benefit meaningfully, while imports continue to outperform despite a low economic growth environment, she said.
The figures are notoriously difficult to predict and analysts stress that it is important to look at trends. “On a trend basis, SA’s trade balance remains in surplus but the extent of the surplus has narrowed significantly in recent months,” said Stanlib chief economist Kevin Lings.
However, Investec economist Lara Hodes warns that the current account could be in the red for at least the next quarter. “Looking forward, an elevation in trade tensions could further dampen global trade activity, and while import growth will likely be restricted by the moderation in the international oil price and restrained rates of domestic consumption, we could see the trade account continue to record a deficit position,” she said.
While net trade was a notable positive contributor to second quarter GDP, the trade account’s contribution is likely to be neutral in the third quarter, while the weaker trade performance will also put further pressure on the balance of the current account, said Kruger.
This comes ahead of the third-quarter current account figures, which are expected to show a wider budget deficit on Thursday. This would be the third consecutive quarter that showed a deficit.