SA business confidence slips to all-time low

Sacci's Business Confidence Index fell to 79.3 in May from 82.5 the previous month.

Statistics generic. Picture: Freeimages.

JOHANNESBURG - South Africa's Business Confidence Index (BCI) fell to a new all-time low in May, hurt by poor performances in sectors such as manufacturing and retail.

The South African Chamber of Commerce and Industry's (Sacci) BCI fell to 79.3 in May from 82.5 the previous month.

The index slipped to 79.6 in December after President Jacob Zuma changed finance ministers twice within the space of a week.

"The BCI suffered a setback following a gradual recovery in April 2016, from a historic low level of 79.6 in December 2015. This was undone in May 2016," Sacci said in a statement.

"Seasonally adjusted merchandise import volumes had the largest negative month-on-month effect in May 2016, followed by real retail sales and a weaker weighted rand exchange rate against the US dollar, euro and the British pound."

Sacci said possible downgrades to South Africa's credit rating posed a risk to the BCI. It said the government should focus on measures that promote the production side of the economy.

South Africa has dodged downgrades from S&P Global Ratings and Moody's, but analysts say a downgrade could be on the cards in December if policy measures failed to revamp the ailing economy.

Ratings agency Fitch is expected to publish its review on South Africa on Wednesday, according to the National Treasury.

Fitch is yet to officially announce when it will publish its review.