Standard Bank sees brighter future for SA economy – but these issues need to be addressed first

Goolam Ballim, Standard Bank Chief Economist. Picture: X/SBGroup Things are looking brighter for South Africa’s economy than they have in the last few years, and Standard Bank says this momentum could continue, but certain things need to keep happening. Goolam Ballim, Standard Bank chief economist, highlighted that the country hasn’t had a macroeconomic climate this supportive.

He was presenting the bank’s 2026 economic outlook on Tuesday morning, which was full of hope for the years ahead, even as political fragmentation remains a concern. Ballim’s optimism for the country’s economy stems from key milestones that SA achieved in 2025. This includes sovereign credit rating upgrades, inflation target, macro reforms and the country’s removal from the grey list.

When the country’s economy is doing well, this will be visible in households’ finances. Ballim’s presentation showed that there is a positive outlook on income growth, with growth reaching the same level of 2018. One of the biggest challenges facing the country is its high unemployment rate.

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The latest Quarterly Labour Force Survey (QLFS) shows thatunemployment fell in the fourth quarter of 2024, with 17.1 million people now employed. Standard Bank’s outlook expects the employment momentum to continue, noting that there are now a million more jobs than before Covid. The presentation outlined that credit appetite among households has been growing as a result of the repo rate cut cycle.

Late in January, the Monetary Policy Committee of the Reserve Bank decided to keep therepo rate unchanged at 6.75%. Ballim emphasised that a drop in repo rates has also given people more spending power. He said they are hoping for more cuts this year, as the real rate remains high. According to Standard Bank’s data, most people spend on services, followed by non-durable goods, durable good and semi-durable goods.

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