South Africa's economic conditions point to recession

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Since last year, consumer confidence among the high-income group (those earning more than R20 000 a month) was lower than those considered low-income earners. It slumped from -11 to -18 index points in the first quarter and crashed to -30 in the second quarter. Photo: Alfonso Nqunjana/News24
Since last year, consumer confidence among the high-income group (those earning more than R20 000 a month) was lower than those considered low-income earners. It slumped from -11 to -18 index points in the first quarter and crashed to -30 in the second quarter. Photo: Alfonso Nqunjana/News24

BUSINESS

Consumer confidence was at a 30-year low in the second quarter of this year. The latest consumer confidence index (CCI) compiled by FNB/Bureau for Economic Research plunged to -25 points – its lowest level in more than three decades – if the drop during the height of the Covid-19 pandemic was to be excluded. The CCI showed confidence was down across all income groups.

This comes as a significant number of South African consumers struggle every day to put food on the table and meet their other immediate needs. Consumers face significant pressure from increases in the costs of food and fuel, resulting in a dramatic deterioration in consumer sentiment.

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