The BER/RMB Business Confidence Index (BCI) rose to 47 in 1Q2026, from 44 in 4Q2025 and 39 in 3Q2025.
BCI It is now six points above its long-term average of 41 and 20 points above the post-Covid low reached in the third quarter of 2023. If the post-Covid surge of 50 from 2Q2021 is removed, the 1Q2026 reading is the highest since 2015.
The increase in business confidence partly reflects the improvement in South Africa's economic growth from 0.4% year-on-year in Q3 2024 to 2.1% year-on-year in Q3 2025. Fourth quarter economic growth data is due on March 10.
Business Confidence Index highlights
The BCI survey took place from 12 to 23 February 2026. The BER said the improvement in business confidence was supported by the generally well-received State of the Nation Address (SONA) on February 12, as well as the continued stability of the national unity government. Therefore, the impact of the budget presented on February 25 is outside the survey period.
BER noted that the rand is 7% stronger against the US dollar compared to the fourth quarter of last year, which is positive from a cost perspective, although this has some impact on export competitiveness. Although the South African Reserve Bank (SARB) left the policy rate unchanged in January, the repo rate remains 100 basis points (bps) below the level a year ago, and while the 10-year government bond yield has declined by 70bps since the fourth quarter BCI. This is about 200 bps less than a year ago.
BER said the above changes maintain a meaningfully more supportive interest rate environment compared to the previous quarter and a year ago. That said, the background was not without challenges. Geopolitical tensions intensified, while domestically the water crisis in Gauteng deepened; Limpopo and Mpumalanga were affected by floods; And the outbreak of foot-and-mouth disease (FMD) persisted.
first quarter statement
BCI covers five areas. The BER acknowledged that the improvement in the business confidence index was not widespread, despite market sentiment being generally positive. There has been a decline in confidence among manufacturers and retailers after encouraging profits in the previous quarter.
However, solid growth among new vehicle dealers, wholesalers and building contractors has offset these declines.
New Vehicle Dealers remained the most optimistic sector, up from 58 in the fourth quarter to 67 and only 42 in the second quarter of 2025. This belief is well founded given that new vehicle sales in February 2026 were the best February since 2013.
wholesalers and building Both contractors were at neutral 50 in the first quarter, down from 42 and 39 respectively in the fourth quarter. The Budget's focus on infrastructure investment will further boost confidence among building contractors in the coming year.
This is reflected in the fact that the non-residential sector is performing better than the residential sector.
BER felt retailers took a sigh of relief at the start of the new year retail Confidence fell 7 points to 36 as base effects began to weigh on annual growth rates. This is slightly below the long-term average of retail confidence at 40.
Sales of non-durables and durables softened in the first quarter, while semi-durables and semi-durables such as clothing performed somewhat better.
BER expresses regret over survey result manufacturers Where confidence fell by 9 points to 30. The sector is grappling with weak demand conditions, which is insufficient to generate sustained improvement in production. Nevertheless, forward-looking investment indicators remain relatively bullish.