Friday, July 30, 2010

SA June trade surplus at R5.6 billion

South Africa recorded a trade surplus of 5.6 billion rand ($762.3 million) in June compared with a 302 million rand shortfall in May, the South African Revenue Service said on Friday.

SARS said in a statement exports rose by 17.8 percent to 55.6 billion rand compared with the previous month, outpacing a 5.2 percent increase to 49.9 billion rand in imports.

Economists polled by Reuters had predicted a 2 billion rand deficit in the trade account, but the number is generally volatile and difficult to forecast.

ANALYST COMMENT

GEORGE GLYNOS, MANAGING DIRECTOR, ETM

"It looks like a very strong number. It appears that ... the transport strike may have something to do with this. It is very difficult to ascertain that at this stage of the game, but it's a big trade surplus number.

"It gives perspective as to why the rand has been resilient and strong as it has been. One waits to see if this is sustained through the July data, given that we did not have a transport strike at that time."

MARKET REACTION

The rand traded at 7.3371 against the dollar at 14:12 SA timefrom 7.34 before the data was published at 16:00 SA time. The yield on the benchmark 2015 government bond was at 7.64 percent from 7.65 percent beforehand.

BACKGROUND

- Pressure on the trade account has previously been increasing as the local economy recovers after last year's recession, with importers of capital goods rising.

- Latest data shows the current account deficit widened to 4.6 percent of GDP in the first quarter of 2010 compared with a 2.9 percent gap in the fourth quarter of 2009.