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Current account deficit widens in second quarter

Trade surplus widens to R65 billion.

South Africa’s current account deficit widened to 2.4% of GDP in the second quarter as an increased trade surplus was offset by a larger shortfall on services, income and current transfer payments, the central bank said on Thursday.

The overall deficit was wider than forecast by economists surveyed by Reuters, who had expected it to match the first quarter figure of 2.0%.

The rand was barely moved by the data, and at 0820 GMT it traded 0.19% firmer at 13.1225 per dollar.

A rise in the value of exported gold and merchandise goods, helped widen the trade surplus widened to R65 billion ($4.95 billion) from R57 billion  in the first quarter, the Reserve Bank said in its September quarterly bulletin.

The services, income and current transfer account deficit widened to 3.8% from 3.3%, it said.

Transfers rose on a 42% year-on-year increase to R14 billion in the amount South Africa paid to its trading partners in the Southern African Customs Union (SACU).

In February, the Treasury had budgeted for SACU payments of 56 billion for the 2017/18 fiscal year, up 42% from 2016/17.

The net income deficit widened as both dividend payments to non-resident investors and dividend receipts from abroad fell, the bank said.

($1 = 13.13)

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