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The BETI in August - A very sharp bounce back

13 September 2017BankservAfrica

For the first time the BankservAfrica Economic Transaction Index (BETI) increased by more than 1% in real terms on a year-on-year basis, with August transactions on the national payments system reflecting a 1.2% increase in the value. A second consecutive increase points to a seeming break in the streak of declines noted in previous months.

Moreover, both the monthly and quarterly changes also increased, which is the first time since April 2016 that all three period measures are positive. The strong monthly and quarterly increases of 1.5% and 1.9% respectively are also indicative of a very strong economic performance by the overall economy.

This all-round improvement is a great bounce back for the South African economy especially if sustained. August, in general, seems like a very strong economic transaction month and shows a lot of economic activity coming to the fore. Real time clearing, for example, recorded the highest growth with a staggering 32.6% increase on a year ago.

While GDP came in stronger than expected in the second quarter, the BETI did indicate an improving performance. The end of the unexpected recession was widely welcomed but did rely much on agriculture and mining.

The BETI is good at capturing economic activity across a broad number of sectors and shows a close relationship to the overall economy although much of the mining sector’s income does not go through the normal national payments system.

The number of transactions and the nominal value also bounce upwards

In August the number of transactions showed a 6.1% growth valued at 94.9 million, a continued trend from previous months. The total monetary value of the transactions also increased with a staggering 9.3% in nominal terms.

The average size of the transaction increased by just 3% but has increased compared to a year ago, unlike the previous four months, which show that the average transaction size declined.

The standardised value of the total transactions was R817.9 billion for August 2017, which was the first time that a month outside of December reached the R810 billion levels.

While nominal levels are only a relative indication it does seem that the jump in value is higher than usual and indicates that significant economic activity was held back by the recent downgrades.

Graph 1: The BETI and the SARB coincident indicator yearly change

Source: BankservAfrica and Economists.co.za

Graph 2: The BETI and the SARB coincident Indicator quarterly changes

Source: BankservAfrica and Economists.co.za

Table 1: The BETI Numbers

Source: BankservAfrica and Economists.co.za

Table 2: The standardised nominal BETI and the number of transactions

Source: BankservAfrica and Economists.co.za

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