Briefing Note 1: Global commodity prices and the South African economy

Briefing Note 1: Global commodity prices and the South African economy Commodity prices have soared to the highest level in two decades due to supply constraints driven by the COVID-19 pandemic and the war in Ukraine. [...] This is evident in Graph 2, which shows that the prices of iron ore, gold and platinum began to fall shortly after the spike that followed the Russian attack on 24 February 2022. [...] As noted in the REB, the trade surplus is narrowing as export prices and imports increase with the economic recovery. [...] The Reserve Bank warns that the fiscal deficit will increase sharply if the revenue boost from the trade surplus declines before private sector spending and growth accelerate.2 South Africa's recovery from the pandemic is likely to remain volatile as the country's growth rate, investment and job creation all tend to track world commodity prices, particularly for metals and coal.3 2Loewald, C., 202. [...] Mining and Minerals in South Africa in Oqubay et al (ed), The Handbook of the South African Economy.