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Adjusting our growth, inflation and fiscal expectations


We expect GDP growth of 1.8% yoy in 2022 and 1.9% in 2023.


Our neutral range for the USDZAR is between 15,10 and 15,70, with a year-end target at 16,00. As such, we remain better buyers of USD when the rand strengthens below this range.


We forecast CPI (average) at 5.7% in 2022 and 5,1% in 2023.


We expect SARB to hike by 25 bps in March. We forecast another 75 bps worth of hikes in 2022, taking the repo rate to 4,75% by year-end. We have a repo rate ending 2023 at 5,25%, compared to SARB’s 5,84%.

Bond yields

Global factors, including a tighter monetary policy stance, higher global inflation rates and a higher risk-free rate (UST yields) have raised fair-value yields since our last update. Our fair-value estimate for the 10-year yield is 9,9% (R2032). We adjust our fair-value range for the R2048 50 bps higher to 10,50-11,00%.

Rating action

The recent GDP rebasing affected the sovereign’s near-term debt burden metrics positively, and the revenue overshoot has helped narrow the primary budget deficit compared to what was expected earlier in the year. However, what induced the last cycle of downgrades was the pace at which debt was accumulating, rather than the absolute stock level of debt. While the pace of accumulation should slow in the coming years, rating agencies remain cautious, as long-run risks to GDP growth and fiscal stability still weigh on the credit outlook.

The agencies still worry about commodity price reversals, the impact of global rate increases on emerging market risk sentiment and the impact of local socio-political pressures on expenditure ceilings. Eskom and other SOE bailouts continue to cloud the fiscal outlook, while reforms are only taking shape slowly. Fitch rates South Africa “BB-/Stable”, Moody’s “Ba2/Neg.” and S&P “BB-/Stable”.

Source: Nedbank CIB Markets Research

Disclaimer – The views and observations in this report represent the analyst’s own and not the Multivest nor Nedbank Group house view.


Multivest Chartbook - February 2022

Multivest Portfolio Returns

Disclaimer: The investor is liable for CGT on any transactions in the units of the underlying unit trusts within the wrap funds. Compulsory investments are not subject to CGT. Performance is calculated using net returns(after fees) of the underlying unit trusts, and quoted excluding wrap fund fees. Performance quoted is pre-tax. Fund performance numbers shown are for a notional portfolio and do not reflect the actual performance of the client invested in the wrap fund due to timing differences of investments or disinvestments of the client. Benchmark returns for CPI are based on actual published returns and an estimated one month return for the month of the report date. ASISA Benchmark returns are the ASISA returns available as at the time of reporting.

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