South Africa Races to Halt Third COVID Wave as Its Economic Outlook Improves
South African economic activity has rebounded quicker than expected in recent months and the rand is the strongest-performing emerging market currency this year, but the country is racing to roll out Covid-19 vaccines as a third wave looms.
In its Financial Stability Review on Thursday, the South African Reserve Bank said the economy was continuing to rebound from a 2020 recession that saw gross domestic product contract by 7%, its steepest decline for over a century.
“Positive data releases, an uptick in global economic activity, robust international trade, elevated commodity prices and improved mobility” led NKC African Economics to upgrade its first-quarter GDP forecast to a 1.4% quarterly expansion, up from a previous forecast of a 3.3% contraction. NKC analysts now expect GDP to grow by 3.1% in 2021.