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South Africa

Business conditions are reasonable and the outlook is more positive domestically, with the suspension of load shedding since March 26 assisting all manufacturing activities. The prime lending rate is still at 11.75% although the anticipation is that this could start to be reduced in June or July.  

In other data, inflation increased to 5.3% in January from 5.1% in December while the ABSA Purchasing Managers Index dropped to below 50 in March, indicating a contraction in the manufacturing sector. At the time of writing, the rand is trading at 18.50 to a weaker US dollar.

The ban on exports of copper scrap is still in place but dealers are still exporting copper ingots, blocks and billets. Exports of brass scrap, including Honey and Nomad, are also continuing. Aluminium scrap can still be exported through the International Trade Administration Commission but most dealers are selling locally, except in the case of one or two grades that are not consumed domestically and therefore need to be exported.

The General Election is taking place on May 29 and all eyes are on whether the ruling ANC will obtain a majority or will require a coalition. The result will have an immediate effect on the economy and the way forward.