{"id":62923,"date":"2024-03-19T11:10:41","date_gmt":"2024-03-19T11:10:41","guid":{"rendered":"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown"},"modified":"2024-03-19T11:46:01","modified_gmt":"2024-03-19T11:46:01","slug":"south-africa-is-entering-the-great-unknown","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown","title":{"rendered":"South Africa is entering the great unknown"},"content":{"rendered":"

Africa-Press – South-Africa. <\/strong><\/span>South Africa, like the rest of the world, is set to enter the \u2018great unknown\u2019, where political uncertainty begets market volatility.<\/p>\n

This is according to Discretionary Fund Manager Cogence, a partnership between Discovery and the world\u2019s largest asset manager, Blackrock, which believes that the debate around whether the world will achieve a soft landing in 2024 is misplaced.<\/p>\n

Cogence CEO and CIO Jonel Matthee-Ferreira said that an unexpected rally in the global equity market in 2023 is welcome but not universal.<\/p>\n

\u201cWhat shouldn\u2019t be overlooked is just how narrow this has been \u2013 led by a mere handful of mega-cap American tech companies benefitting from the normalisation of the United States economy after the pandemic,\u201d said Matthee-Ferreira.<\/p>\n

Cogence said that the impact of profound structural shifts currently underway is a more relevant conversation for the coming years.<\/p>\n

The global investment regime is changing from Great Moderation \u2013 a long period of stable growth and inflation \u2013 to the Great Unknown \u2013 characterised by geopolitical fracturing and higher interest and inflation rates.<\/p>\n

Matthee-Ferreira and Cogence investment specialist Kerri-Ann Sattary sat down with BusinessTech to explain what the \u2018Great Unkown\u2019 means for South Africa:<\/p>\n

Interest rates<\/p>\n

Matthee-Ferreira said that global interest rates will likely stay higher longer as inflation remains sticky.<\/p>\n

The US economy has been resilient despite elevated inflation and interest rates.<\/p>\n

Considering the USA\u2019s 2.5% growth in GPD in 2023, there is less urgency for the Federal Reserve to cut interest rates to boost economic growth.<\/p>\n

Although South Africa\u2019s GDP growth was only 0.6% in 2023, any interest rate cuts from the South African Reserve Bank (SARB) will likely only follow cuts in the US.<\/p>\n

However, rate cuts in South Africa are still expected to occur in the second half of 2024, with inflation expected to be within the SARB\u2019s target range and the need to stimulate the economy.<\/p>\n

Inflation<\/p>\n

Inflation is set to be higher for longer compared to the past due to the weakness of the rand and the struggles in the electricity and logistics sector.<\/p>\n

However, South Africa is not isolated in this, with geopolitical fragmentation, shrinking workforces and the transition to low-carbon energy likely to prevent economies from growing at pre-pandemic levels without stocking inflation.<\/p>\n

\u201cCentral banks are in a wholly different position now compared to where they were a decade ago. They can no longer flood the market with cheap money to accelerate growth,\u201d said Matthee-Ferreira.<\/p>\n

Rand<\/p>\n

Matthee-Ferreira said that although the rand may strengthen somewhat this year, it is unlikely to be anything substantial.<\/p>\n

Large amounts of uncertainty are linked to the 2024 South African election, with markets waiting to see the outcome in what is expected to be the most hotly-contested election in South Africa\u2019s history.<\/p>\n

Elections<\/p>\n

Despite the election anxiety facing investors, once the polls have closed at the end of May and the administration officially takes over, sentiment should improve.<\/p>\n

Investors currently sitting on the fence should start committing more capital once they know who will be running the country, especially in the renewable energy sector.<\/p>\n

South Africa is not alone in having a national election this year, with 49% of the world\u2019s population headline to the polls.<\/p>\n

The USA is set for a Joe Biden and Donald Trump rematch this year, with positives and negatives for South Africa no matter what happens.<\/p>\n

The US economy tends to remain resilient no matter who the president is. Although Cogence looks to diversify risk and is less focused on country-specific risk, the rest of the world tends to do well when the USA\u2019s economy does well.<\/p>\n

However, the USA has been known to flip-flop with its policy on emerging markets, as is the case with its chip war with China, which poses a potential risk for South Africa.<\/p>\n

For More News And Analysis About South-Africa<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – South-Africa. South Africa, like the rest of the world, is set to enter the \u2018great unknown\u2019, where political uncertainty begets market volatility. This is according to Discretionary Fund Manager Cogence, a partnership between Discovery and the world\u2019s largest asset manager, Blackrock, which believes that the debate around whether the world will achieve a […]<\/p>\n","protected":false},"author":84,"featured_media":62922,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,6],"tags":[274,315,275],"class_list":["post-62923","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-files","tag-africa-press","tag-africa-press-south-africa","tag-south-africa-2"],"yoast_head":"\nSouth Africa is entering the great unknown - South Africa<\/title>\n<meta name=\"description\" content=\"South Africa, like the rest of the world, is set to enter the \u2018great unknown\u2019, where political uncertainty begets market ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"South Africa is entering the great unknown\" \/>\n<meta property=\"og:description\" content=\"South Africa, like the rest of the world, is set to enter the \u2018great unknown\u2019, where political uncertainty begets market ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown\" \/>\n<meta property=\"og:site_name\" content=\"South Africa\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2024-03-19T11:10:41+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-03-19T11:46:01+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/03\/sm_1710836103.914113.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1024\" \/>\n\t<meta property=\"og:image:height\" content=\"683\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"South Africa is entering the great unknown\",\"datePublished\":\"2024-03-19T11:10:41+00:00\",\"dateModified\":\"2024-03-19T11:46:01+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown\"},\"wordCount\":639,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/south-africa\/sites\/31\/2024\/03\/sm_1710836103.914113.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-South-Africa\",\"South-Africa\"],\"articleSection\":[\"all news\",\"files\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown\",\"url\":\"https:\/\/www.africa-press.net\/south-africa\/all-news\/south-africa-is-entering-the-great-unknown\",\"name\":\"South Africa is entering the great unknown - 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