South African business confidence rose to its highest level in five months in September after an improvement in share prices and a stronger rand offset the effect of strikes on the economy.
The business confidence index rose to 91.4 from 90.5 in August, the South African Chamber of Commerce and Industry said in an e-mailed statement today. The index is compiled from 13 economic indicators, including retail sales, inflation and financial gauges, such as a stock-market index and currency.
“The ongoing labor disputes and accompanying disruptions of the economy contributed to the economy not gaining pace despite glimmers of hope in some domestic and global economic activities,” the Johannesburg-based chamber said.
Thousands of workers in mining, manufacturing and construction have downed tools in labor disputes since August. Carmakers including Bayerische Motoren Werke AG and Ford Motor Co. (F:US) lost an estimated 20 billion rand ($2 billion) due to work stoppages. Reserve Bank Governor Gill Marcus said on Oct. 1 the central bank remains concerned about the effect of strikes on Africa’s largest economy.
The rand has gained 3.1 percent against the dollar since reaching a four-year low on Aug. 28. It fell 0.3 percent to 10.0482 against the dollar as of 11:21 a.m. in Johannesburg.
The chamber said higher business confidence is needed to help boost investment in construction, equipment and transport industries.
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