On the upside, South Africa’s wide current account deficit of the past few years has narrowed for four consecutive quarters. This can, in part be attributed to temporary factors, but there is also some indication that both import and export volumes are responding to the depreciation of the rand and the weaker economy.
How global headwinds, including China’s slowdown may alter this outlook, remains to be seen. As you know, the SARB targets inflation within a flexible framework, which allows for temporary breaches of the target being tolerated under certain circumstances.