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Money Market FundsThe current account is a useful tool for gauging South Africa’s external position. South Africa’s current account deficit narrowed to -R57bn in Q3 from a revised reading of -R72.2bn in Q2.
As a percentage of GDP, the current account shortfall also fell back to -0.7% in Q3, from -1.0% in Q2 and below consensus expectations of -1.2%.
Of the three main components that make up the current account, the goods trade surplus (i.e. exports minus imports of goods) narrowed further to R178.3bn in Q3 (from R187.2bn in Q2).
SA imports increased by relatively more than exports did over the quarter. The services trade deficit (i.e. exports minus imports of services) worsened over Q3 to -R69.0bn (from -R58.0bn in Q2), while the income and current transfer deficit (money flowing in and out from investments across borders) narrowed slightly to -R166bn in Q3 (from -R202bn in Q2). A deficit implies that SA is paying more in income, dividends, and interest on debt to the rest of the world than it is receiving from foreign assets.
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