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<\/a><\/figure>\n\n\n\nThe value of fixed-investment projects in South Africa rose to R794 billion ($42 billion) in 2024, up from R193 billion in 2023, according to Credit Agricole. The increase comes amid progress on infrastructure and energy reforms, including public-private partnerships at the country\u2019s biggest port. Electricity provider Eskom Holdings SOC Ltd. reduced disruptions, further supporting economic activity.<\/p>\n\n\n\n
Annual inflation, which accelerated marginally in November to 2.9%, still remains around the lowest level in more than a decade and well within the central bank\u2019s 3% to 6% target range. Inflation expectations for the next year have dropped to 4.6%, according to the Bureau for Economic Research, providing the South African Reserve Bank with room to cut interest rates. The SARB has already lowered borrowing costs by 50 basis points since September, with markets anticipating another reduction in early 2025.<\/p>\n\n\n\n
Infrastructure improvements will likely benefit the country \u2014 and its currency \u2014 further, said Gustavo Medeiros, deputy head of research at Ashmore. \u201cLogistic reforms and a visible recovery in tourism inflows are creating tangible growth and foreign exchange benefits,\u201d he said.<\/p>\n\n\n\n
Meanwhile, inflows into South Africa\u2019s bond market are on track for the highest level since 2019, according to JSE Ltd. data. Non-residents\u2019 net purchases of local debt totalled R41.4 billion in the third quarter, up from R13 billion in the previous three months, according to the central bank, which also noted that the economy is in its longest upward cycle since 1999.<\/p>\n\n\n\n
\u201cSouth Africa is showing it can deliver on the fundamentals,\u201d Credit Agricole\u2019s Barb\u00e9 said. \u201cThe data reflects the foundation for continued momentum into 2025.\u201d<\/p>\n\n\n\n
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