Colen Garrow
Colen Garrow
currency growth hold potential pressure reaching sector
Manufacturing will be under pressure because of currency strength. It will hold the sector back and (keep) growth from reaching its potential level.
battling crippled mining sector similar strong supply
Manufacturing is not the only supply sector battling a strong currency. Mining is being crippled by a similar problem.
business estate mining relative sector service size
The relative size of the mining sector is dwarfed by the contribution of the finance, real estate and business service sector's 19,5%.
although global looks persistent pick recovery remains sector strength threatened
The manufacturing sector remains threatened by the persistent strength of the rand, although it should pick up from what looks to be a recovery in global manufacturing.
demand global growing itself local modest number pulling sector slump strength though
It's a modest number but it could be better were it not for the rand. The sector is growing on strength of local demand and it does look as though global manufacturing is pulling itself out of a slump - but we are not out of the doldrums yet.
consistent controls deviate environment exchange national path rand remains strong treasury unlikely
While an environment in which the rand remains strong is always appropriate for something more creative, the National Treasury is unlikely to deviate from its consistent path of removing exchange controls gradually.
argued cause central debt further growing levels rate remains stimulus
While it remains manageable, it can be argued that it is the rate at which debt levels are growing that may cause no further stimulus from the central bank.
corporate remains somewhat tax unchanged
From this perspective, it is somewhat disappointing that corporate tax remains unchanged at 29% and that STC also remains unchanged at 12.5%.
bank cut exchange likely moral support
What the bank is more likely to do (than cut rates) is intensify its moral suasion in support of a more competitive exchange rate.
government situation thus
The situation as it is, is thus inequitable and will have to be addressed by government at some stage.
committee cycle easier provides reminder stance taken useful
The stance the committee has taken probably provides a useful reminder that the easier interest-rate cycle has bottomed.
activities currency goods impact imported persistent similar strength
Persistent currency strength has had a detrimental impact on export-based activities in the manufacturing sector, making similar imported goods more competitive.
code considered exchange good hardly interest issue likely matter moral observers rand rate
Another issue likely to resurface is the matter of 'a more competitive exchange rate', deciphered as code for the rand to weaken. Moral suasion such as this may be good for export-biased manufacturers, but will hardly be considered good for observers of inflation, or long-term interest rate markets.
interest meets next rates
The SARB will probably do nothing with interest rates when it meets next week.