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South African business confidence improved in July, indicating the business climate is slowly returning to normality, the South African Chamber of Commerce & Industry said on Wednesday.
The SACCI business confidence index increased to 110.3 points in July from 108.5 in June. It was 6.1 index points up on the low of 103.2 in May.
Business confidence was 2.6 points above the 107.7 recorded in July last year.
The average of 108.6 for the first half of this year was 1.5 index points higher than the average for the second half last year.
Increased merchandise export and import volumes, and more new vehicles sold made positive contributions to the business climate in the short-term in July, SACCI said. But higher inflation, a weaker and volatile rand exchange rate, and higher real interest rates weighed negatively on the business environment.
‘The BCI for June and July 2022 indicates that the negative medium-term business sentiment of May 2022 was replaced by positive developments if compared to the same period of last year,’ said the South African business lobby.
Among these positive developments, it said, inward tourism recovered markedly, while increased new vehicle sales pointed towards medium-term investment.
The present business climate is still be hurt by rising inflation globally and by distortions of global supply chains and commodity markets, the SACCI said.
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