March 28 (Bloomberg) -- South Africa’s trade deficit narrowed in February from a record in the previous month as exports of metal and other commodities rebounded following a series of strikes. The rand gained the most in two weeks.
The shortfall eased to 9.5 billion rand ($1 billion) from 24.5 billion rand in January, the Pretoria-based South African Revenue Service said today in an e-mailed statement. The median estimate of 10 economists in a Bloomberg survey was 12.5 billion rand. The rand gained as much as 1.1 percent after the data was released, the most since March 14.
“This partly reflects the impact of the weaker rand,” Isaac Matshego, an economist at Nedbank Group Ltd. in Johannesburg, said in a phone interview. “We could see this trend continuing as the weaker rand is very supportive of our exporters.”
The trade deficit in 2012 was more than six times larger than a year before as slower global growth and mining strikes curbed exports. That put pressure on the current account gap, which is near a four-year high, and undermined the rand. The currency of Africa’s largest economy slumped 7.8 percent against the dollar this year, the second-worst performer of 16 major ones tracked by Bloomberg after the yen.
The rand strengthened to 9.1882 per dollar at 2:06 p.m. in Johannesburg from 9.2368 before the data was released. The yield on the rand bond due in March 2021 dropped 8 basis points to 6.51 percent.
Exports climbed 17 percent to 62.3 billion rand in February from the previous month, led by an 80 percent increase in vehicle and aircraft shipments and a 26 percent gain in precious, semi-precious stones and metals, the revenue agency said. Shipments of mineral products, which includes coal and iron ore, rose 3 percent.
Total imports dropped 7.7 percent to 71.8 billion rand in the month, led by a 20 percent decline in prepared foods, beverages and tobacco, the agency said. Machinery imports dropped 15 percent.
The deficit on the current account, the broadest measure of trade in goods and services, will probably average 6.2 percent of gross domestic product in the next three years, up from an earlier estimate of 5.6 percent, the National Treasury said in its Budget Review last month. South Africa relies mainly on foreign investment in stocks and bonds to finance the shortfall, inflows that have fluctuated as investors sold riskier, emerging-market assets.
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