For South African investors, the key themes were a higher repo rate, slightly firmer consumer inflation and weaker private-sector business activity. Internationally, slower Chinese growth, softer US employment data and geopolitical risks continued to influence currencies and investor confidence.

Global economy: Higher rates meet persistent price pressure

Central banks use interest rates to influence borrowing, spending and inflation. During September, several major central banks tightened policy as energy costs and broader price pressures remained a concern. Higher rates can help slow inflation over time, but they also make credit more expensive and can restrain economic growth.

Geopolitical risks remained important. Energy-price and supply-chain pressures linked to conflict in the Middle East can feed into transport, production and, ultimately, consumer prices.

What this means for you: A period of higher or less predictable interest rates can create short-term market volatility. It also changes the relative appeal of cash, bonds and shares, reinforcing the value of a diversified portfolio.

United States: The Fed raises rates as hiring slows

The US Federal Reserve raised its benchmark interest-rate range by 0.25 percentage points to 3.75%–4%, its first increase since 2023. Annual headline inflation reached 3.4% in August, above the Fed’s 2% long-term target, with higher energy prices contributing to the increase.

The Fed said the economy was still growing at a healthy pace, but indicated that further tightening could be needed. Sixteen of the 18 officials who submitted projections expected at least one more 0.25 percentage-point increase before the end of 2026. The Fed now expected inflation to return to 2% only in 2029.

The labour market was softer. US nonfarm payrolls rose by 29 000 in September, below the 84 000 expected by economists surveyed by Dow Jones, while unemployment increased to 4.2%. Earlier payroll figures were revised lower by a combined 60 000 jobs.

What this means for you: Higher US rates can support the US dollar and affect global asset prices. Softer job creation also means the Fed must balance inflation control against the risk of slowing growth.

China: Domestic demand remains under pressure

China’s growth slowed to 4.3% in the second quarter of 2026 from 5% in the first quarter. July and August data pointed to continued weakness, linked to low consumer confidence, a struggling housing market, falling price pressure and an imbalance between strong production and softer demand.

Against this backdrop, Presidents Xi Jinping and Donald Trump met in Washington in September. Their discussions covered trade, artificial intelligence and international issues. Both emphasised continued engagement and a more stable relationship, while acknowledging areas of competition and disagreement.

What this means for you: China is an important destination for global commodities. Changes in Chinese demand can influence commodity prices, emerging-market sentiment and South African assets.

Europe: Energy pushes inflation higher

Eurozone inflation rose sharply to 3.8% in September from 3.2% in August, according to Eurostat’s flash estimate. Energy inflation accelerated to 18.8%, while core inflation, which excludes volatile energy, food, alcohol and tobacco prices, edged up to 2.5%. The headline reading was almost double the European Central Bank’s 2% target.

What this means for you: Higher European inflation may keep interest rates elevated and weigh on household spending. It can also affect demand for exports from trading partners, including South Africa.

Japan: A gradual move away from very low rates

The Bank of Japan increased its benchmark rate from 1% to 1.25%, the highest level since 1995. Since ending negative interest rates in 2024, the bank has raised rates six times. Core inflation eased to 1.7% in August but remained close to the bank’s 2% target.

Japan continued to face a weak yen, higher living costs and demographic pressures. Its reliance on imported energy also leaves the economy vulnerable to higher energy prices and supply disruptions.

What this means for you: The gradual end of very cheap Japanese funding may influence global currency and bond markets, although the direct effect on individual long-term plans will vary.

South Africa: Repo rate rises as business activity softens

The South African Reserve Bank raised the repo rate by 0.25 percentage points to 7.25% in a unanimous decision. The repo rate is the rate at which the Reserve Bank lends to commercial banks and is a key influence on borrowing rates across the economy.

Consumer inflation edged up to 4.4% in August from 4.3% in July, remaining near the midpoint of the Reserve Bank’s 3%–6% target range. Policymakers expected inflation to move above 5% later in 2026 and in early 2027, mainly because of higher fuel prices, before easing as the fuel-price shock faded.

Private-sector business conditions weakened in September. The S&P Global South Africa Purchasing Managers’ Index, or PMI, fell to 49.0 from 50.5 in August. A reading below 50 signals contracting activity. Companies reported weaker demand, supply-chain disruption and the sharpest fall in new orders in two-and-a-half years. Export orders nevertheless increased for a fourth month, employment was broadly stable and business confidence improved to a four-month high.

Higher fuel costs raised business input prices, while congestion at the Port of Durban and Middle East-related disruptions contributed to delivery delays and material shortages.

What this means for you: The repo-rate increase may raise repayments on variable-rate debt and add pressure to household budgets. Fuel and transport costs may also remain noticeable, although the report expects this particular inflation shock to fade over time.

Markets: Conflicting signals drive volatility

Global markets

The source report did not provide monthly index returns. The main market drivers were the shift towards higher policy rates, rising energy prices, softer US employment data and signs of slower Chinese growth. These forces can pull markets in different directions: higher rates may pressure bonds and growth-sensitive shares, while geopolitical risk and currency movements can create additional volatility.

Domestic markets

No domestic equity, bond or currency returns were included in the source report. Locally, attention centred on the repo-rate increase, the expected fuel-linked rise in inflation and weaker business activity. Export resilience and improved business confidence provided some balance to the softer demand picture.

What this means for you: Short-term market moves often reflect changing expectations rather than a lasting change in long-term value. An appropriate mix of local and offshore assets can reduce dependence on any single country, currency or asset class.

Key takeaways for investors

• Inflation remained the central concern, with energy costs adding pressure in the US, Europe and South Africa.
• Interest rates rose in the US, Japan and South Africa, increasing borrowing costs while reinforcing central banks’ focus on price stability.
• US employment growth slowed, while China’s economy lost momentum after a stronger first quarter.
• South African business activity weakened, although exports, stable employment and improved confidence offered some support.
• With monetary policy, growth and geopolitics sending mixed signals, diversification remains especially important.

Why this matters for your financial plan

Economic news can be unsettling when interest rates are rising and growth signals are mixed. However, a financial plan is designed around long-term goals, not a single month’s data. Different assets respond differently to inflation, interest rates, currencies and economic growth, which is why diversification remains a core risk-management tool.

Before making changes, consider whether a development alters your goals, time horizon or ability to tolerate risk. Discuss any proposed adjustment with your financial adviser, who can assess it in the context of your full plan rather than in response to short-term headlines.

Disclaimer

Graviton Financial Partners (Pty) Ltd and Sanlam Multi Manager International (Pty) Ltd are authorised financial services providers in terms of the Financial Advisory and Intermediary Services Act, 2002. Past performance is not necessarily a guide to future performance.

The information in this document is provided for information purposes only and should not be construed as financial advice. The value of investments and income may vary and is not guaranteed. Changes in currency exchange rates may cause the value of investments to fluctuate.

While every effort has been made to ensure the accuracy and reasonableness of the information contained in this document, Graviton Financial Partners (Pty) Ltd, Sanlam Multi Manager International (Pty) Ltd, their shareholders, subsidiaries, agents, officers, and employees do not accept liability for any direct, indirect, or consequential loss arising from the use of, or reliance on, the information provided.

The post Economic Overview | September 2026 appeared first on ACS Financial Management.

Closer to home, South African inflation slowed in July as fuel prices fell, and private-sector activity expanded slightly in August. The rand strengthened and the local share market delivered a strong headline return, although gains were concentrated in resources companies. 

Global economy: Uneven growth and renewed inflation pressure

The global economy continued to balance slowing inflation, economic growth and interest-rate expectations. Higher oil and gas prices added inflationary pressure in several developed economies, while economic performance varied across regions.

The US saw stronger job creation, China continued to face weak domestic demand, and parts of Europe experienced rising inflation linked to energy costs. Higher bond yields also reflected ongoing concerns about inflation and future economic growth.

What this means for you: Global economic conditions remain mixed, which can create periods of market volatility. Diversified portfolios remain important when different regions and sectors perform differently.

United States: Job creation rebounds

The US economy added 162,000 jobs in August, the strongest monthly increase in five months, while unemployment remained steady at 4.1%.

Inflation rose to 3.4% in July, while economic growth slowed compared with earlier in the year. Expectations remain that interest rates could stay higher for longer as policymakers continue to monitor inflation trends.

What this means for you: A resilient labour market supports consumer spending, but higher inflation and borrowing costs may continue to influence investment markets and economic growth.

China: External strength, but weak domestic demand

China’s economy remained divided between strong export growth and weaker domestic activity. While exports continued to perform well, consumer spending, investment activity and the property sector remained under pressure.

Policymakers introduced targeted support measures, but growth is still expected to remain subdued, with further interest-rate cuts possible later this year.

What this means for you: China’s economic performance remains important for global trade and commodity demand. Slower domestic growth could affect emerging markets and commodity-related investments.

Europe: Energy lifts inflation

Eurozone inflation rose to 3.3% in August, largely because of higher oil and gas prices. However, underlying inflation pressures eased, suggesting that broader price increases remain relatively contained for now.

In the UK, the services sector continued to show resilience, with business activity expanding during the month.

What this means for you: Energy prices remain a key factor influencing inflation, interest-rate expectations and market sentiment. Encouragingly, underlying inflation trends have continued to improve.

Japan: Foreign reserves decline sharply

Japan’s foreign exchange reserves recorded a significant decline during August, reflecting large-scale efforts to support its currency.

What this means for you: Currency movements can influence offshore investment returns when converted back into rand, even if the underlying investments perform well.

South Africa: Inflation slows and activity improves slightly

South Africa’s annual inflation rate slowed to 4.3% in July from 5.0% in June, coming in below expectations. Lower fuel prices were the primary driver, helping to reduce transport costs and ease overall price pressures.

The South African Reserve Bank kept interest rates unchanged, while business activity improved slightly, with the private sector showing modest expansion during August.

What this means for you: Lower fuel prices have provided some relief for consumers, but household budgets continue to face pressure from transport, electricity and other living costs. Interest rates remain stable, but significant rate relief should not be assumed in the near term.

Markets: Positive returns, but uneven performance

Global markets

Global share markets ended August higher, supported by changing expectations around economic growth and interest rates. Developed and emerging market shares both delivered positive returns, while global bonds produced modest gains. Listed property remained under pressure.

What this means for you: Different asset classes perform differently over time. A diversified portfolio can help reduce risk while still providing exposure to growth opportunities.

Domestic markets

The FTSE/JSE All Share Index gained 4.65% during August, making it one of the strongest-performing major markets for the month. However, most of the gains came from the resources sector, while financial and industrial shares ended lower.

The rand strengthened against major currencies, which can reduce the rand value of offshore investments over the short term.

What this means for you: Strong headline market returns do not always reflect broad-based gains. Diversification across sectors and asset classes remains important, particularly when market performance is concentrated in a single sector.

Key takeaways for investors

• US job growth strengthened, but inflation and interest-rate uncertainty remain important risks.
• China’s exports stayed resilient, while domestic demand and the property sector remained under pressure.
• Higher energy prices pushed eurozone inflation higher, although underlying inflation eased.
• South African inflation slowed and business activity improved modestly.
• Global and local equity markets delivered positive returns, with local gains largely driven by resource companies.

Why this matters for your financial plan

Economic conditions and market sentiment can change quickly as investors respond to developments in inflation, interest rates, growth and global events. August highlighted how different regions, sectors and asset classes can experience very different outcomes within the same environment.

While short-term uncertainty is a normal part of investing, maintaining a long-term perspective and a well-diversified investment strategy can help manage changing market conditions. If you are unsure how recent developments may affect your portfolio, speak to your financial adviser before making any investment decisions.

Disclaimer

Graviton Financial Partners (Pty) Ltd and Sanlam Multi Manager International (Pty) Ltd are authorised financial services providers in terms of the Financial Advisory and Intermediary Services Act, 2002. Past performance is not necessarily a guide to future performance.

The information in this document is provided for information purposes only and should not be construed as financial advice. The value of investments and income may vary and is not guaranteed. Changes in currency exchange rates may cause the value of investments to fluctuate. While every effort has been made to ensure the accuracy and reasonableness of the information contained in this document, Graviton Financial Partners (Pty) Ltd, Sanlam Multi Manager International (Pty) Ltd, their shareholders, subsidiaries, agents, officers, and employees do not accept liability for any direct, indirect, or consequential loss arising from the use of, or reliance on, the information provided.

The post Economic Overview | August 2026 appeared first on ACS Financial Management.

Understanding these trends can help you make more informed financial decisions and stay focused on your long-term plan.

Global economy: Inflation relief, but slower growth

The global economy continues to grow, but the pace is uneven. Lower energy prices have helped ease inflation in some regions, but growth is slowing in major economies such as the United States and China.

Interest rates, energy costs, and global political tensions remain important factors influencing markets and investor confidence.

United States: Inflation eases, but growth slows

The US saw encouraging inflation news in July, with consumer prices falling more than expected. Lower energy prices helped reduce inflation, offering some relief after earlier price increases.

The annual inflation rate eased to 3.5%, while underlying inflation, which excludes food and energy prices, remained more stable.

The US economy is still supported by:

• Strong consumer spending
• Continued investment in technology and artificial intelligence
• Business investment
• Government spending

However, economic growth slowed in the second quarter, and the US Federal Reserve is still focused on bringing inflation closer to its target. This means interest rates may remain higher for longer.

What this means for you:

Lower inflation is positive, but higher interest rates can still affect global markets, borrowing costs, and investment returns. Investors should expect markets to remain sensitive to interest rate decisions.

China: Growth under pressure

China’s economy had a more difficult month in July. Factory activity contracted for the first time since February, pointing to weaker demand at home and some pressure on exports.

The slowdown was not limited to manufacturing. Construction, services, and broader business activity also weakened during the month.

China’s economy grew by 4.3% year-on-year in the second quarter, its slowest pace in more than three years. Policymakers have acknowledged the challenges and signalled that more support may be introduced to help growth in the second half of the year.

What this means for you:

China remains important to global growth and trade. Slower growth there can affect emerging markets, commodity demand, and investor confidence, especially in regions closely linked to global trade.

Europe: Resilient, but energy risks remain

The eurozone economy remained reasonably resilient, supported by stronger-than-expected economic growth in the second quarter. However, inflation increased slightly in July.

Higher energy prices were one of the main reasons for the increase. Inflation also differed across countries, showing that some parts of Europe are experiencing more pressure than others.

What this means for you:

Europe continues to play a stabilising role in the global economy, but higher energy prices remain a key risk. Any sharp increase in oil or gas prices could place renewed pressure on growth and markets.

South Africa: Inflation rises, rates stay unchanged

South Africa’s inflation rose to 5.0% in June, its highest level in two years. The increase was mainly driven by higher fuel and transport costs.

• Transport was the biggest contributor to the increase, with higher prices for fuel, taxis, e-hailing services, long-distance buses, and school transport all adding pressure.
• Despite higher inflation, the South African Reserve Bank kept the repo rate unchanged at 7% at its July meeting. This surprised many analysts, who had expected an increase.
• The Reserve Bank remains cautious and is watching risks such as higher oil prices, food inflation, and global instability.

What this means for you:

Higher fuel and transport costs may affect household budgets. At the same time, stable interest rates provide some relief for borrowers, although future rate decisions will depend on inflation and economic conditions.

Markets: A mixed but positive month

Markets delivered mixed results in July as investors balanced improving inflation news with concerns about slower growth and interest rates.

Global markets

Global shares ended the month higher overall, helped by strength in technology-related companies, especially semiconductor businesses.

However, emerging market shares came under pressure, while global bonds remained weak. Global property investments performed well during the month.

Domestic markets

South African shares ended July higher, with the FTSE/JSE All Share Index gaining ground in rand terms.

Local market performance was supported by:

• Industrial shares
• Property shares
• Financial shares

A recovery in resource shares after a difficult June

Local bonds were mixed. Shorter-term bonds delivered positive returns, while longer-term bonds came under pressure. The rand weakened against the US dollar, euro, and pound sterling during the month.

What this means for you:

Market ups and downs are normal, especially when investors are responding to changing inflation, interest rate, and growth expectations. A diversified investment plan remains important for managing risk.

Key takeaways for investors

• Inflation is easing in some parts of the world, but risks remain.
• US growth is slowing, even though consumers and technology investment remain supportive.
• China’s economy is under pressure, which may affect emerging markets and global trade.
• Europe remains resilient, but energy prices are still a key risk.
• South African inflation has risen, mainly because of fuel and transport costs.
• The South African Reserve Bank kept interest rates unchanged in July.
• Markets remain mixed, making diversification important.

Why this matters for your financial plan

Economic conditions can change quickly, and markets often react to new information about inflation, interest rates, growth, and global events.

While short-term uncertainty can feel unsettling, it is a normal part of investing. Staying focused on your long-term goals and maintaining a well-diversified investment plan can help you remain on track through changing market conditions.

If you are unsure how recent market developments may affect your portfolio, speak to your financial adviser before making any changes.

Disclaimer

Graviton Financial Partners (Pty) Ltd and Sanlam Multi Manager International (Pty) Ltd are authorised financial services providers in terms of the Financial Advisory and Intermediary Services Act, 2002. Past performance is not necessarily a guide to future performance.

The information in this document is provided for information purposes only and should not be construed as financial advice. The value of investments and income may vary and is not guaranteed. Changes in currency exchange rates may cause the value of investments to fluctuate. While every effort has been made to ensure the accuracy and reasonableness of the information contained in this document, Graviton Financial Partners (Pty) Ltd, Sanlam Multi Manager International (Pty) Ltd, their shareholders, subsidiaries, agents, officers, and employees do not accept liability for any direct, indirect, or consequential loss arising from the use of, or reliance on, the information provided.

The post Economic Overview | July 2026 appeared first on ACS Financial Management.

Global markets in 2026 are balancing growth with ongoing uncertainty, as rising costs and interest rates continue to shape economies worldwide. While short-term volatility persists, staying focused on long-term goals and diversification remains key for investors.

Key insights for investors

As we move through the middle of 2026, global markets are experiencing a blend of stability, uncertainty, and evolving opportunities. While certain economies are exceeding expectations, others are feeling the effects of rising costs and ongoing global developments.

Keeping up with these changes can help you better understand market movements and make more confident financial decisions.

Global Economy: progress with pockets of pressure

The global economy is still expanding, although growth is uneven across regions. Some countries are performing strongly, while others are being held back by inflation, elevated interest rates, and geopolitical challenges. These factors continue to influence both economic performance and investor sentiment.

United States: solid growth, emerging pressures

The US economy delivered a strong start to the year, driven by:

• Increased investment in technology and artificial intelligence
• Continued government expenditure
• Ongoing consumer spending

That said, some risks are becoming more visible:

• Consumers are increasingly relying on debt and savings
• Borrowing costs remain high due to elevated interest rates
• Interest-rate-sensitive sectors, such as housing, are under strain

The Federal Reserve has paused rate hikes for now but may tighten policy further if inflation persists.

What this means for you:
The US continues to play a leading role in global growth, but higher interest rates could moderate economic activity and influence markets worldwide.

China: growth moderates

China’s economy continues to expand, although at a slower and more balanced pace than in the past. This reflects a shift towards more sustainable growth, supported by policy measures and investment in key industries.

• Manufacturing, exports, and government support are key growth drivers
• The property market remains under pressure
• Key risks include weaker global demand, energy price volatility, and geopolitical tensions

Ongoing policy support, along with investment in innovation and renewable energy, is helping to steady the outlook.

What this means for you:
China remains a critical part of the global economy, but slower growth could have ripple effects on trade and emerging markets.

Europe: resilient but cautious

The eurozone has proven relatively resilient, with steady—though modest—growth continuing despite global uncertainty.

• Businesses and households are adapting to challenges
• Rising energy costs and geopolitical risks remain key concerns

Shifts in energy prices and economic momentum continue to influence confidence levels and market direction.

What this means for you:
Europe contributes to global stability, but its growth outlook remains sensitive to external factors.

South Africa: gradual growth with cost pressures

South Africa’s economy is growing, but only slowly, and remains influenced by both global conditions and local challenges. While certain sectors are performing well, rising living costs continue to put pressure on households.

Economic Growth: limited but ongoing

The economy recorded modest growth in early 2026, supported by:

• Agriculture, finance, and trade sectors
• Increased consumer and government spending

However, manufacturing remains weak, and overall growth continues at a subdued pace.

Inflation: impacted by fuel prices

Inflation increased to 4.5%, largely driven by higher fuel costs.

• Transport and electricity expenses have risen
• Underlying inflation remains relatively stable

There are signs inflation may ease if global energy markets stabilise, although short-term pressures remain.

What this means for you:
Rising fuel and energy costs may affect everyday expenses, but overall inflation is still relatively contained.

Markets: navigating ups and downs

Markets have seen periods of volatility in recent months, largely due to uncertainty around inflation and interest rate movements. While this can feel unsettling, it is a normal part of the investment cycle.

Global Markets

• Equities and bonds have experienced short-term fluctuations
• Performance varies across sectors and regions

Although volatility may persist in the near term, long-term investment trends remain in place.

South African Markets

• The JSE recorded declines for a second consecutive month
• Mining shares were the main contributors to losses
• Property, financials, and bonds delivered more positive results

The rand weakened against the US dollar, while strengthening against other major currencies.

What this means for you:
Market fluctuations are expected in uncertain environments, making diversification an essential strategy for managing risk.

Key Takeaways for Investors

• Global growth continues, but at varying speeds
• Interest rates remain a major influence on markets
• Inflation is still being driven largely by energy costs
• Market volatility is likely to persist
• Diversification remains a key investment principle

Why this matters for your financial plan

Market movements—both positive and negative—are a natural part of investing. While uncertainty can introduce risks, it can also create new opportunities.

Keeping a long-term perspective and maintaining a well-diversified portfolio can help you stay aligned with your financial goals, even when markets are unpredictable.

Graviton Financial Partners (Pty) Ltd and Sanlam Multi Manager International (Pty) Ltd are authorised financial services providers in terms of the Financial Advisory and Intermediary Services Act,2002. While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSPs, their shareholders, subsidiaries, clients, agents, officers and employees do not make any representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaim all liability for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance upon the information. The information in this document has been recorded and arrived at by Graviton Financial Partners (Pty) Ltd (FSP) Licence No. 4210 in good faith and from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to its accuracy, completeness or correctness. The information is provided for information purposes only and should not be construed as rendering investment advice to clients.

The post 2026 Mid-Year Market Overview appeared first on ACS Financial Management.

Global economic conditions remain uncertain, with growth expected to slow over the coming year. This is largely driven by ongoing geopolitical tensions in the Middle East, which continue to disrupt energy supply and push up costs worldwide. As a result, both businesses and consumers are likely to feel the effects through rising prices and increased market volatility.

The Global Picture

Across major economies, conditions remain mixed:

• United States: Economic activity is holding up, particularly in the services sector, but businesses are preparing for supply shortages and rising costs.
• China: Growth continues, although at a slower and more moderate pace.
• United Kingdom and Europe: Growth is expected to soften as higher energy prices put pressure on consumers and businesses.

In response to these shifting dynamics, global companies are re-evaluating where they invest. There is a growing focus on:

• The United States for its strong financial markets
• India for its growth potential
• South-East Asia for supply chain opportunities and diversification

This reflects a broader trend of businesses adapting to a changing global environment.

South Africa in Focus

Locally, the impact of global pressures is becoming more evident. Inflation has started to rise, mainly due to higher fuel costs, prompting the South African Reserve Bank to increase interest rates to 7%.

This has practical implications for households:

• Borrowing costs, including home loans, are likely to increase
• Everyday expenses may continue to rise
• Financial pressure on consumers may intensify

In this environment, careful budgeting and ongoing financial planning are becoming increasingly important.

Market Performance

Investment markets delivered a mixed performance in May, with notable differences across regions and asset classes.

• Global equities: Delivered solid gains, largely driven by technology and artificial intelligence-related companies
• Emerging markets: Experienced a particularly strong month, outperforming many developed markets
• South African equities: Slightly negative for the month, but still marginally positive year to date

More stable asset classes also played an important role:

• Bonds: Continued to provide steady, positive returns
• Cash: Delivered modest but consistent gains
• Rand: Strengthened against major global currencies, offering some local support

This highlights the value of diversification during periods of uncertainty.

Key Risks to Watch

Looking ahead, several risks remain important to monitor:

• Ongoing Middle East conflict, which could further disrupt oil supply and global trade
• Rising fuel and food prices, placing pressure on inflation
• Potential climate-related risks, such as drought conditions affecting food supply

These factors may continue to influence both economic conditions and market performance in the months ahead.

Staying on Track

While short-term uncertainty may create market fluctuations, maintaining a long-term perspective remains key. A well-diversified investment strategy can help manage risk and position portfolios to benefit from future opportunities.

It is also important to:

• Regularly review your financial plan
• Ensure your investments remain aligned with your long-term goals
• Stay informed, but avoid reacting to short-term market movements

If you would like to understand how these developments may impact your personal financial plan or investments, we encourage you to get in touch. Ongoing guidance and informed decision-making can help you stay on track, even in uncertain times.

Graviton Financial Partners (Pty) Ltd and Sanlam Multi Manager International (Pty) Ltd are authorised financial services providers in terms of the Financial Advisory and Intermediary Services Act,2002. While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSPs, their shareholders, subsidiaries, clients, agents, officers and employees do not make any representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaim all liability for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance upon the information. The information in this document has been recorded and arrived at by Graviton Financial Partners (Pty) Ltd (FSP) Licence No. 4210 in good faith and from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to its accuracy, completeness or correctness. The information is provided for information purposes only and should not be construed as rendering investment advice to clients.

The post Economic Overview | May 2026 appeared first on ACS Financial Management.

What it means for your money

Global markets experienced a more positive month in April, recovering from earlier volatility caused by geopolitical tensions. While risks remain, there are also encouraging signs across major economies and financial markets.

Here’s a clear summary of what’s happening — and why it matters to you.

Global economy: Signs of resilience, but uncertainty remains

Despite ongoing conflict in the Middle East and rising energy costs, several large economies showed surprising resilience in April.

United States: Jobs market still holding up

The US economy continues to create jobs, even though hiring has slowed compared to last year. Unemployment remains steady, and wage growth is easing — which helps reduce pressure on interest rates.

Source: US Bureau of Labor Statistics

What this means for investors:

• The US economy is slowing gently rather than sharply
• Interest rates are likely to stay higher for longer, but sudden increases look less likely
• Markets generally respond well to stability, even if growth is slower

China: Exports bounce back

China’s exports rose sharply in April, driven by strong demand for technology and AI‑related products. This helped offset weaker spending at home.

What this means for investors:

• Global trade is still functioning despite tensions
• China remains an important driver of global manufacturing and growth
• Ongoing demand supports emerging market investments

United Kingdom: Growth returns, but prices are rising

The UK economy picked up in April after a weak March. However, inflation pressures increased sharply, mainly due to higher energy costs and supply disruptions.

Source: S&P Global PMI

What this means for investors:

• Economic growth may be uneven in the months ahead
• Inflation remains a challenge, which could delay interest rate cuts
• UK assets may stay volatile in the short term

South Africa: Growth outlook downgraded, but consumers show resilience

The International Monetary Fund has lowered South Africa’s growth forecast for 2026 to 1%, mainly due to higher fuel costs and global uncertainty.

Fuel price pressure remains a concern, although government intervention has helped soften recent increases.

That said, local retail sales remain positive, suggesting that consumers are still spending, particularly in areas like clothing, online shopping and lifestyle goods.

What this means for investors:

• Economic growth will likely remain modest
• Higher fuel and transport costs could impact inflation
• Local businesses and consumers are proving more resilient than expected

Markets: A strong rebound after March losses

April was a much better month for investors globally.

Global markets

• Global shares rebounded strongly after March declines
• US, European and Asian markets all posted solid gains
• Bonds also recovered as markets stabilised

South African markets

• The local stock market moved back into positive territory
• Financials and property shares performed well
• The rand strengthened against the US dollar and euro
• Local bonds delivered strong returns after earlier sell‑offs

What this means for investors:

• Market recoveries often happen quickly after periods of fear
• Staying invested through volatility remains important
• Diversification across asset classes continues to add value

Key takeaways for clients

• The global economy is slowing, but not stalling
• Markets recovered strongly in April after earlier volatility
• Energy prices and geopolitics remain key risks
• A long‑term, diversified investment approach remains essential

Graviton Financial Partners (Pty) Ltd and Sanlam Multi Manager International (Pty) Ltd are authorised financial services providers in terms of the Financial Advisory and Intermediary Services Act,2002. While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSPs, their shareholders, subsidiaries, clients, agents, officers and employees do not make any representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaim all liability for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance upon the information. The information in this document has been recorded and arrived at by Graviton Financial Partners (Pty) Ltd (FSP) Licence No. 4210 in good faith and from sources believed to be reliable, but no representation or warranty, expressed or implied, is made as to its accuracy, completeness or correctness. The information is provided for information purposes only and should not be construed as rendering investment advice to clients.

The post Economic Overview | April 2026 appeared first on ACS Financial Management.

US and China agree to slash tariffs for 90 days

In May, the US and China agreed to a temporary suspension of most tariffs on each other’s goods to ease trade tensions between their economies. As part of the deal, reciprocal tariffs were reduced from 125% to 10%. However, the US will maintain a 20% tariff on Chinese imports related to fentanyl, leaving overall tariffs on Chinese goods at 30%. US Treasury Secretary Scott Bessent stated that the two countries have agreed to a 90-day pause and a significant reduction in tariff levels, noting that each side will lower their tariffs by 115%. Both countries indicated they will continue talks on trade and economic policy.

Since starting his second term in January, US President Donald Trump has implemented a wave of aggressive trade measures that have unsettled financial markets and sparked concerns about a possible recession. These tariffs, which are aimed at reducing the US trade deficit, have particularly targeted China. Previously, Trump had imposed duties as high as 145% on Chinese goods, leading Beijing to retaliate with its own measures, including limiting exports of certain rare earth minerals. News of a temporary easing of tariffs brought relief to investors.

Following the announcement, US tariffs on steel, aluminum, and auto exports remained unchanged, as these sectors were not part of the reciprocal tariffs. Chinese steel products continue to face a 45% tariff hike introduced in 2025, which, when combined with the earlier 25% tariff imposed in 2018, brings the total US tariff on Chinese steel to 70%. Market sources indicated that Chinese aluminum exports are likely to stay high in the coming months due to ongoing re-export activity. Meanwhile, they noted that Chinese imports of copper scrap from the US could gradually pick up again, if tariffs on American goods were lowered to 10%.

UK GDP growth

The UK economy expanded at its fastest rate in Q1 2025, growing by 0.7% year-on-year (y/y), according to the Office for National Statistics (ONS). This exceeded market forecasts of 0.6% y/y and marked a sharp improvement from the 0.1% y/y growth recorded in Q4 2024. The economy outperformed expectations, despite concerns about a downturn, as businesses accelerated investment and exports before Trump’s sweeping tariffs. The ONS noted that growth in the services sector was broad based, with strong performances in retail, wholesale, computer programming, car leasing, and advertising. These gains were slightly offset by declines in education, telecoms, and legal services. Overall, services grew by 0.7%, while the production sector – which includes manufacturing, mining, and energy – grew by 1.1%. The construction sector, however, did not grow during the quarter.

Economists warned that the strong start to 2025 may not be sustained. There are expectations of weaker growth later in the year due to uncertainty surrounding President Trump’s unpredictable tariff policies, especially following his “Liberation Day” announcement on 2 April. Despite these concerns, Chancellor Rachel Reeves highlighted the Q1 results as evidence that the UK government’s strategy is delivering, noting that the UK outpaced all other G7 economies during the quarter. She emphasised that the government was making the right decisions in the face of global instability. Since the 2024 election, the UK has implemented four interest rate cuts, secured two new trade agreements, rescued UK Steel, and raised the minimum wage, benefitting millions of workers.

For your interest

1. Moody’s downgrades the US

• Credit rating agency Moody’s downgraded the US government’s credit score by one notch from AAA to AA1. Moody’s became the last of the three major rating agencies to strip the US of its AAA rating.
• It cited rising debt and interest costs “that are significantly higher than similarly rated sovereigns”.

(Source: Al Jazeera, May 2025)

2. US Fed holds rates steady

• The US Federal Reserve (US Fed) kept its benchmark interest rate unchanged in May, holding the line at 4.25% to 4.5%, as it did at the March meeting.
• However, the US Fed acknowledged that since its last meeting in March, the risks of higher inflation and higher unemployment had increased, in part due to trade policy.

(Source: JP Morgan, May 2025)

3. China’s retail sales growth slows

• China’s retail sales rose 5.1% y/y from a year earlier in April, missing analysts’ estimates of 5.5% growth, according to a Reuters poll. Sales grew by 5.9% in the previous month.
• Industrial output grew 6.1% y/y in April, stronger than analysts’ expectations for a 5.5% y/y rise, while slowing down from the 7.7% y/y jump in March, indicating the impact of US tariffs was not as harsh as had been expected.

(CNBC, May 2025)

4. UK and India sign historic deal

• The UK and India have signed a free trade deal which will ‘further strengthen the UK-India strategic partnership.
• The agreement will cut levies on 90% of British products sold to the country, including whisky, food and electrical devices. The new agreement is expected to increase bilateral trade between the countries by US$34 billion a year from 2040.

(World Economic Forum, May 2025)

5. SA’s unemployment rate rises

• South Africa’s official unemployment rate rose to 32.9% y/y in Q1 2025. This is marginally lower than the highest rate of 33.5% y/y experienced in Q2 2024.
• Job losses were recorded in five of ten industries, including trade, construction, private households, community & social services and mining.

(Stats SA, May 2025)

SARB reduces repo rate by 25 bps

The SARB cut the repo rate by 25 basis points to 7.25%, with the prime lending rate at 10.75%. In his announcement, SARB Governor Lesetja Kganyago noted that global economic conditions have remained unstable since the last Monetary Policy Committee meeting. He highlighted a sell-off in US assets, while traditional safe havens like gold and the euro have performed strongly during this period.

Kganyago also warned that a combination of rising trade barriers and heightened global uncertainty is expected to dampen global economic growth, prompting the SARB to revise its global growth forecasts downwards. He noted that the outlook for global inflation was more complicated. On one hand, US tariffs and supply chain disruptions could drive inflation higher, potentially raising prices in other economies. On the other hand, slower global growth, falling oil prices, and surplus production capacity in countries like China could exert downward pressure on inflation. Given these mixed signals, the SARB anticipates a modest decline in global interest rates this year. While the US Fed has held its rates steady, other central banks, such as the Bank of England and the European Central Bank, have cut their policy rates.

The SARB has revised its GDP growth forecasts. It now expects the economy to expand by 1.2% in 2025, with growth rising to 1.8% by 2027. While the outlook for structural reforms remains encouraging, Kganyago acknowledged that global headwinds, including weaker international growth, could weigh on the domestic economy. However, the central bank views the risks to growth as balanced at this stage. On the inflation front, headline inflation fell below 3% again in April. In response, the SARB is discussing the implications of anchoring inflation at the lower end of its target range, at 3%, and what this would mean for interest rates. The SARB had previously been targeting a midpoint of 4.5% within its 3-6% inflation target range. This revision would reflect a lower base level of inflation, expectations of a stronger rand, and declining global oil prices. Kganyago also noted that previous inflation projections had factored in VAT increases, which have since been scrapped, contributing further to the downward adjustment.

Market overview

Global overview

Developed market (DM) equities climbed back into positive territory for the year with the MSCI World Index ending at 5.92% month-on-month (m/m) in US dollars. This is the best monthly return in eighteen months. Although they were also in positive territory, emerging market (EM) equities underperformed their DM peers with the MSCI EM Index ending at 4.31% m/m in dollars. The biggest contributor to the MSCI EM’s performance was Chinese equities. Magnificent 7 stocks were at the forefront of May’s rally, as strong earnings announcements drove the S&P 500’s return of 6.29% m/m in US dollars. Global property posted gains of 2.60% m/m for May, but global bonds posted losses of -0.36% m/m in the same period, both in US dollars. The FTSE 100 Index gained 4.14% m/m in pounds, with the Euro Stoxx 50 Index gaining 5.42% m/m in pounds. The Dow Jones Index was also positive for the month, at 4.16% m/m in US dollars. Japan’s benchmark Nikkei Index continued April’s gains into May, ending the month at 5.33% m/m in yen.

Local overview

South African equity markets followed global equity markets higher in May with the FTSE/JSE All Share Index ending at 3.14% m/m in rand terms.  Industrials and Resources posted gains of 2.37% m/m and 2.61% m/m respectively. Property, Financials, and Cash posted gains of 2.32% m/m, 2.47% m/m and 0.63% m/m. The bond market was positive for short-, medium-, and long-term bonds, with the FTSE/JSE All Bond Index ending the month positively at 2.73% m/m. Bonds of 1-3 years were positive at 0.81% m/m along with bonds of 3-7 years at 1.74% m/m. Bonds of 7-12 years were positive at 3.64% m/m, and bonds of 12 years and above ended positively at 3.62% m/m. The rand strengthened against the US dollar by 3.04% m/m, the euro by 3.18% m/m, and against the pound by 2.06% m/m.

The post Economic Review | The May Edition appeared first on ACS Financial Management.

US non-farm payrolls increased slightly in May, with job gains continuing but at a slower pace than in April. The US and China, the world’s two largest economies, met in London to advance trade discussions. They aimed to build mutual understanding, strengthen co-operation, and reduce miscommunication. The OECD forecasts a slowdown in global economic growth in 2025 and 2026, primarily due to weaker performance in certain countries. SA’s headline Producer Price Index (PPI) declined in May, while Consumer Price Inflation (CPI) remained steady. SA’s GDP posted modest growth in the first quarter of 2025.

US non-farm payrolls

The Bureau of Labor Statistics reported a slowdown in hiring in the US in May compared with April, as businesses and consumers responded cautiously to tariffs and concerns about a weakening economy. Non-farm payrolls increased by 139 000, exceeding the Dow Jones forecast of 125 000 but below April’s revised total of 147 000. Nearly half of the new jobs came from the healthcare sector, which added 62 000 positions, well above its 12-month average of 44 000. The leisure and hospitality industry contributed 48 000 jobs, while social assistance roles increased by 16 000.

On the downside, the US government lost 22 000 jobs as President Donald Trump’s initiative to downsize the federal workforce, along with efforts by the formerly Elon Musk-led Department of Government Efficiency, began to take effect. The national unemployment rate remained steady at 4.2% year-on-year (y/y), while a broader metric that includes discouraged and under-employed workers was also unchanged at 7.8% y/y. Wages grew more than anticipated, with average hourly earnings rising 0.4% for the month and 3.9% over the past year, surpassing forecasts of 0.3% and 3.7%, respectively. The combination of solid job gains and steady unemployment highlights the US labour market’s resilience despite recent economic disruptions.

The US labour report reflects a job market that remains strong, but mounting economic pressures suggest it may eventually begin to fluctuate. The data is set against a backdrop of growing uncertainty, fuelled by Trump’s tariffs and the unpredictable extent of his efforts to rebalance global trade in favour of US goods. While most economic indicators suggest a recession is not imminent, sentiment surveys reveal significant concern among both consumers and business leaders. Many are bracing for the potential slowdown in business activity and the inflationary effects caused by the tariffs. In response, US Federal Reserve (US Fed) officials are approaching the current situation with heightened caution.

China and the US confirm trade deals

The Chinese and US economic and trade teams confirmed the details of the framework for implementing the Geneva trade talks in June. According to a statement from China’s Ministry of Commerce (MOFCOM), China will assess and approve eligible export applications for controlled items in line with its laws and regulations. In return, the US will lift several restrictive measures previously imposed on China.

The statement from China’s Ministry of Commerce (MOFCOM) was issued in response to inquiries about claims by some US officials and media outlets that China and the US had reached a supplementary agreement on implementing the Geneva trade talks consensus. These reports suggested that China would speed up its approval process for rare-earth exports to the US, while the US would, in turn, lift certain related restrictions on China. The MOFCOM confirmed that, since trade discussions in London on 9-10 June, both sides had remained in close communication.

The MOFCOM expressed hope that the US would work with China in a spirit of collaboration, making full use of the China-US economic and trade consultation mechanism, in line with the key understandings reached during the 5 June phone call between the two heads of state. The ministry emphasised the need to build on common ground, minimise misunderstandings, deepen collaboration, and jointly advance the healthy, stable, and sustainable development of China-US economic and trade relations.

A Chinese expert said the current progress between China and the US reflected efforts to turn consensus into concrete actions, and such practical measures provided important support for all parties, including US businesses, by helping to stabilise supply chains and strengthen development resilience. However, concrete actions and sincerity are needed from the US to implement the consensus and deliver results, the expert said, urging the US to meet China halfway. News of the progress in China-US trade issues has drawn widespread attention, following early reports from certain Western media outlets. The US and China finalised a trade understanding reached last month in Geneva, the US Commerce Secretary claimed. The China deal, which the US Commerce Secretary claimed had been signed, sets out the terms laid out in trade talks between Beijing and Washington, including a commitment from China to deliver rare earths, according to the report. Reuters reported that Trump said the US had signed a deal with China, without providing additional details.

Trade policy weakens global growth

According to the OECD’s June 2025 economic outlook, global growth is projected to slow from 3.3% in 2024 to 2.9% in both 2025 and 2026. The deceleration is expected to be most pronounced in the US, Canada, Mexico, and China, with more modest slowdowns in other regions.

Inflationary pressures have re-emerged in some economies, driven partly by increased trade costs in countries implementing new tariffs. These higher costs are likely to add upward pressure to inflation, though the effect may be partially counterbalanced by declining commodity prices. Across G20 economies, annual headline inflation is forecast to ease from 6.2% year-on-year (y/y) in 2024 to 3.6% y/y in 2025 and 3.2% y/y in 2026.

Real GDP growth projections for G20 countries in 2025 and 2026

The OECD Secretary-General said that the global economy had moved from a phase of resilient growth and falling inflation to a more uncertain trajectory. The latest economic outlook reveals that rising policy uncertainty is undermining trade and investment, eroding confidence among consumers and businesses, and dampening growth prospects. The Secretary-General emphasised the need for governments to engage constructively through dialogue to address challenges in the global trading system. He called for keeping markets open and upholding the benefits of a rules-based trading system, which supports competition, innovation, productivity, efficiency, and long-term growth.

The outlook also identifies several key risks including the threat of increased trade fragmentation, potential tariff hikes and retaliatory measures, which could deepen the global growth slowdown and severely disrupt cross-border supply chains. Additionally, inflation could prove more persistent than expected, particularly in countries grappling with higher trade costs or tight labour markets. This could lead to more restrictive monetary policies, further straining economic growth.

For your interest

1. G7 Summit takes place in June

• World leaders of the G7 nations – the US, Italy, France, Germany, the UK, Canada, and Japan – gathered in Canada from June 15-17 for their annual summit.
• This year’s summit occurred against the backdrop of escalating conflict between Israel and Iran, trade tensions between the US and the G7 nations, and the ongoing Russia-Ukraine war. President Donald Trump left the summit early to return to Washington and address the rising conflict between Israel and Iran.

(Source: American University Washington, June 2025)

2. US Fed leaves rates unchanged

• The US Fed kept interest rates steady in a range between 4.25-4.5%, where it has been since December. This is after expectations of higher inflation and lower economic growth ahead.
• Along with the rate decision, the committee indicated, through its closely watched “dot plot,” that two cuts by the end of 2025 were still on the table. However, it lopped off one reduction in both 2026 and 2027, putting the expected future rate cuts at four, or a full percentage point.

(Source: CNBC, June 2025)

3. BOE leaves rates unchanged

• The Bank of England (BOE) decided to keep rates at 4.25%, as inflation remained at its highest level for more than a year and above the Bank’s target rate.
• BOE Governor Andrew Bailey said interest rates remained on a gradual downward path but warned that the world was highly unpredictable. There are concerns that the conflict between Israel and Iran, a major oil producer, could send energy costs higher and drive overall prices up, which would impact further rate decisions.

(Source: BBC, June 2025)

4. SA’s PPI decreases annually and monthly

• SA’s headline PPI final manufacturing figure was 0.1% in May 2025, compared with 0.5% in April 2025. The PPI decreased by 0.3% month-on-month in May 2025.
• The main positive contributor to the headline PPI annual inflation rate was the category of food products, beverages and tobacco products. This was also the main contributor to the monthly rate.

(Source: Stats SA, June 2025)

SA’s quarterly GDP increases slightly

Stats SA reported that the economy grew by just 0.1% in Q1 2025, following a downwardly revised 0.4% expansion in Q4 2024. The slight growth was primarily driven by the agricultural sector, which surged by 15.8% and contributed 0.4 percentage points to overall GDP, supported by increased activity in horticulture and animal production.

The transport sector expanded by 2.4%, adding 0.2 percentage points to growth, while the finance sector rose by 0.2% and trade made a modest contribution of 0.1 percentage points. On the downside, manufacturing was the biggest drag on the economy, contracting by 2% and subtracting 0.2 percentage points from GDP. The electricity and construction sectors also weighed on growth, each contributing a negative 0.1 percentage points.

Real GDP expenditure in SA rose by 0.1% in Q1 2025, supported by increases in household final consumption, changes in inventories, and exports. However, the South African Reserve Bank (SARB) has revised its 2025 growth forecast down to 1.2%, citing underperformance in the mining and manufacturing sectors, along with persistently high unemployment, which rose to 32.9% in the final quarter of 2024. Despite the challenges, the SARB anticipates a gradual improvement in economic growth, projecting it will reach 1.8% by 2027.

Market overview

Global overview

Developed market (DM) equities maintained their positive momentum into June, when the MSCI World Index ended at 4.32% month-on-month (m/m) in US dollars. Equity markets had a brief pullback mid-month as conflict between Israel and Iran escalated, and the US got involved. Ultimately, the conflict de-escalated, and equities resumed their gains into month-end. Emerging market (EM) stocks also had a strong run in June, when the MSCI EM posted the biggest gains at 6.14% m/m in US dollars. The S&P 500 followed suit, ending at 5.08% m/m in US dollars. Global property posted gains of 1.04% m/m for June, and global bonds posted gains of 1.89% m/m over the the same period, both in US dollars. The FTSE 100 Index gained 0.48% m/m in pounds, but the Euro Stoxx 50 Index lost -1.10% m/m in pounds. The Dow Jones Index was also positive for the month, at 4.47% m/m in US dollars. Japan’s benchmark Nikkei Index continued May’s gains into June, ending the month at 6.77% m/m in yen.

Local overview

South African equity markets had a solid end to the first half of 2025, when the FTSE/JSE All Share Index ended at 2.35% m/m in rand terms. Industrials and Property were both in negative territory in June, ending at -0.97% m/m and -0.87% m/m respectively. Resources posted the biggest gains for the month at 4.23% m/m, while Financials and Cash posted gains of 1.20% m/m and 0.60% m/m. The bond market was positive for short-, medium-, and long-term bonds, with the FTSE/JSE All Bond Index ending the month positively at 2.28% m/m. Bonds of 1-3 years were positive at 0.87% m/m along with bonds of 3-7 years at 1.75% m/m. Bonds of 7-12 years were positive at 2.33% m/m, and bonds of 12 years and above ended positively at 3.20% m/m. The rand strengthened against the US dollar by 1.61% m/m, but weakened against the euro by -1.73% m/m, and against the pound by -0.01% m/m.

Graviton Financial Partners (Pty) Ltd is an authorised financial services providers in terms of the Financial Advisory and Intermediary Services Act,2002. The information in this article does not constitute financial advice While every effort has been made to ensure the reasonableness and accuracy of the information  contained in this article (“the information”), the FSP, their shareholders, subsidiaries, clients, agents, officers and employees do not make any  representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaim all liability  for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance  upon the information.

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