South Africa’s household net wealth increased in the second quarter of 2024 as the market valuation of their total assets exceeded that of their total liabilities.
The higher value of assets largely reflected higher share prices, with the FTSE/JSE All-Share Index gaining, on balance, 6.9% in the second quarter of 2024, while the value of housing stock declined, the South African Reserve Bank’s Quarterly Bulletin published on Thursday.
Per the report, the ratio of net wealth to nominal disposable income increased from 389% in the first quarter of 2024 to 393% in the second quarter as the household’s net wealth increased at a faster pace than that in nominal disposable income.
Household debt as a share of disposable income dropped slightly from 63.0% in the first quarter of 2024 to 62.2% in the second quarter because disposable income grew faster than household debt. The cost of servicing debt compared to disposable income also fell slightly from 9.2% to 9.1% during this time, indicating a slower rise in debt, even though the prime lending rate stayed the same.
Unemployment
The official unemployment rate increased for a third consecutive quarter, from 32.9% in the first quarter of 2024 to 33.5% in the second quarter, due to a further increase in the number of unemployed persons.
The not economically active population in South Africa increased by 72,000 persons over this period as the increase in the number of discouraged work seekers outweighed the decrease in the other not economically active category.
As a result, the expanded unemployment rate also increased further, from 41.9% in the first quarter of 2024 to 42.6% in the second quarter.
Debt
South Africa’s total external debt increased marginally to $158.3 billion at the end of March from $158.1 billion in the prior quarter.
South Africa’s total external debt saw a slight increase, rising to $158.3 billion at the end of March from $158.1 billion in the previous quarter. Foreign currency-denominated external debt also grew, climbing to $91.8 billion in the first quarter, up from $89.4 billion in the last three months. This rise was partly attributed to the government borrowing $1 billion from the World Bank and €500 million from the KfW Development Bank.
