Recent data shows better-than-expected house price growth; further demonstrating the decoupling of economic fundamentals and housing market outcomes. Labour market weaknesses remain a major concern. Data shows, in line with our expectations, that job losses are now migrating to more white-collar workers.
Despite the evidently weak, though recovering consumer fundamentals, the FNB Estate Agents Survey shows that buying activity remains defiantly intact. In February retail sales volumes increased by 2.3% y/y, total mining output unexpectedly grew by 0.8% y/y and total manufacturing output declined by 2.1% y/y.
In South Africa 1.4 million jobs were lost, and wage income declined by approximately R28 billion relative to 2019, or just under 1% of GDP. However, the pandemic-induced income losses spread far wider than the labour market. Total manufacturing output declined by 2.1% y/y in February after declining by a downwardly revised 4.2% y/y in January.
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