While South Africa has been in the fortunate position of attracting sufficient capital to finance this deficit, this has mainly entailed portfolio inflows. According to data from the JSE, non-resident inflows to South Africa for the year to 30 June 2016 amounted to R35,7 billion, consisting of R20,4 billion in bond inflows and R15,3 billion in equity inflows.
Market sentiment now holds that rate increases remain quite distant and will be gentle when they do come, thanks to low inflation and moderate growth. Meanwhile, the European Central Bank is still moving towards looser monetary policy, rather than away from it, as is the Bank of Japan.