South Africa Services Mood Bounces Back From Record Low

(Bloomberg) -- Sentiment in South Africa's services sector bounced back from an all-time low in the third quarter but remains weak even as restrictions to curb the spread of the coronavirus pandemic were gradually eased.

A quarterly index measuring confidence in the sector rose to 17 from a record-low of 7 in the three months through June, the Bureau for Economic Research said in an emailed statement Wednesday. That matches the reading recorded in the first quarter of this year, before the virus shuttered all but essential activity for five weeks.

While the improvement follows the May 1 gradual and phased reopening of the economy, more than eight out of 10 businesses remain unsatisfied with conditions, the Stellenbosch-based group said. The survey, which covers hotels, restaurants, real estate, business services and transports signals that the “road to full recovery and the return to pre-lockdown levels is likely to be slow and bumpy,” it said.

Africa's most-industrialized economy could expand by an annualized 45.2% in the third quarter, according to central bank forecasts. That would be the biggest quarterly increase in at least 30 years and would follow a record annualized quarter-on-quarter contraction of 51% in the three months through June.

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