South Africa’s Current Account Surplus Reaches Five‑Year High in Q1 2026
The South African Reserve Bank (SARB) reported that the country’s current account surplus widened to 2.4 % of GDP in the first quarter of 2026, up from 0.6 % in the fourth quarter of 2025. In rand terms the surplus amounted to R190.7 billion, the largest since the third quarter of 2021.
What Drove the Improvement?
The surplus was primarily boosted by a widening trade gap. Merchandise and net gold exports rose while merchandise imports fell, pushing the trade surplus to R437.9 billion in Q1 2026, compared with R282.2 billion in the previous quarter.
- Export growth: Higher prices for gold, platinum group metals and refined petroleum products.
- Import contraction: Reduced demand for certain capital goods and a temporary dip in oil‑related purchases.
- Terms of trade: The ratio of export prices to import prices continued to improve, reflecting stronger export prices and weaker import prices.
Services, Income and Transfers
While the goods trade performed strongly, the deficit in the services, income and current account (which excludes physical trade in goods) widened slightly from R232.1 billion to R247.2 billion. As a share of GDP, this deficit moved from 3.0 % to 3.1 %.
Early Signs of a Reversal in Q2 2026
SARB’s latest monthly data indicate that the trade surplus began to narrow in April 2026, falling to R15.2 billion from R30.2 billion in March. The shift was driven by:
- A rise in imports of generator sets, automatic data‑processing equipment and petroleum products.
- Export flows that remained concentrated in gold, platinum group metals and refined petroleum (excluding crude oil).
Investec economist Lara Hodes noted that the ongoing conflict in the Middle East, which has disrupted global oil supplies since March 2026, is likely to keep import costs elevated in the coming months. She added that “peace talks remain fragile and escalations have been reported; accordingly, uncertainty remains elevated.”
Impact of Oil Price Volatility
Citi’s quantitative model estimates that every 10 % increase in global oil prices deteriorates South Africa’s current account balance by roughly 0.25 percentage points. Given the country’s status as a net oil importer, sustained price spikes could erode the Q1 surplus if the conflict persists into the second half of 2026.
Looking Ahead
The SARB’s balance‑of‑payments release also showed that exports of goods and services fell by US$78.3 billion in Q1 2026, a figure that reflects the valuation of South Africa’s outward shipments in dollar terms. Analysts caution that while the headline surplus is encouraging, the economy remains exposed to external shocks—particularly energy price swings and geopolitical tensions.
For policymakers, the key challenge will be to maintain export competitiveness while managing import‑cost pressures. Continued monitoring of the SARB’s monthly trade reports, alongside updates from reputable sources such as Investec and Citi, will be essential for assessing the durability of the current account improvement.
References
- South African Reserve Bank. “Balance of Payments – Q1 2026.” Press release, 23 May 2026. https://www.resbank.co.za
- Investec. “Middle East Conflict and South Africa’s External Sector.” Research note by Lara Hodes, 12 April 2026.
- Citi Global Markets. “Oil Price Sensitivity of Emerging Market Current Accounts.” Analytical model, March 2026.
