An index tracking SA consumer confidence has remained unchanged at a 2-year low for the fourth quarter of 2019.
The FNB/BER Consumer Confidence Index came in at -7 index points, below its long-term average reading of +2. It was unchanged from the third quarter of 2018.
"This suggests a general pessimism among South African households, and this would likely translate into lower consumption expenditure in the fourth quarter of 2019," said Siphamandla Mkhwanazi, a senior economist at FNB.
Mkhwanazi said a sub-index tracking the economic outlook of SA consumers suggests there is a general expectation there would be a deterioration in SA's economic prospects over the next 12 months.
"Although still optimistic, consumers are still increasingly becoming wary of their financial standing, and are therefore still unwilling to commit to substantial financial obligations at this stage," he said
FNB said the fact that consumer confidence remained underwater during the fourth quarter suggests that the confidence gains since President Cyril Ramaphosa's election in early 2018 have now been "completely reversed".
"South Africa's grim economic reality has become apparent to consumers. With economic growth floundering around 0.5% year-on-year since mid-2018 and the debilitating risk that Eskom's electricity supply and financial problems pose to the domestic economy, it is not surprising that consumers are now also distressed about South Africa's economic prospects."