{
  "title": "A Financial Conditions Index for South Africa",
  "publication": "IMF Working Papers, August 1, 2012",
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  "summary": "The main purpose of this paper is to construct a financial conditions index (FCI) for South Africa. The analysis extracts the index by applying two alternative approaches (principal component analysis and Kalman filter), which identify an unobservable common factor from a group of external and domes",
  "sections": [
    {
      "heading": "Purpose and methodology",
      "content": "- Main purpose: construct a financial conditions index (FCI) for South Africa.\n- Approaches used:\n  - Principal component analysis (PCA).\n  - Kalman filter.\n- Both approaches identify an unobservable common factor from a group of external and domestic financial indicators."
    },
    {
      "heading": "Key findings and predictive performance",
      "content": "- The alternative estimated FCIs share a similar trajectory over time.\n- The FCIs provide powerful predictive information for near-term GDP growth (up to four quarters).\n- The FCIs outperform:\n  - the South African Reserve Bank’s (SARB) leading indicator, and\n  - individual financial variables."
    },
    {
      "heading": "Recent dynamics and implications",
      "content": "- Recent dynamics summarized:\n  - Following a strong recovery in late-2009 and 2010, partly reflecting systematic reductions in the policy rate, the rebound in real economic activity, and a benign inflationary environment, financial conditions have deteriorated in recent months.\n  - The deterioration has not been as sharp as in end-2008.\n- Policy-relevant implication:\n  - Given the FCIs’ relatively high predictive power regarding GDP growth, a further deterioration may imply that economic activity is likely to slow in the period ahead."
    },
    {
      "heading": "Publication and metadata",
      "content": "- Title: A Financial Conditions Index for South Africa\n- Authors: Nombulelo Gumata, Eliphas Ndou, Nir Klein\n- Publication date: August 1, 2012\n- Series: IMF Working Papers\n- Working Paper No.: 2012/196\n- Issue: 196\n- Volume: 2012\n- Pages: 20\n- DOI: https://doi.org/10.5089/9781475505450.001\n- Stock No: WPIEA2012196\n- ISBN: 9781475505450\n- ISSN: 1018-5941\n\nSource: IMF Working Paper — \"A Financial Conditions Index for South Africa\" by Nombulelo Gumata, Eliphas Ndou, and Nir Klein (August 1, 2012).\n\n---\n\n Content in this bundle\n\n- Wp12196\n  - Wp12196 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Wp12196 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/a-financial-conditions-index-for-south-africa-26140"
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    "Authors: Nombulelo Gumata, Eliphas Ndou, Nir Klein",
    "Published: August 1, 2012",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781475505450.001",
    "Main purpose: construct a financial conditions index (FCI) for South Africa.",
    "Approaches used:",
    "Both approaches identify an unobservable common factor from a group of external and domestic financial indicators.",
    "The alternative estimated FCIs share a similar trajectory over time.",
    "The FCIs provide powerful predictive information for near-term GDP growth (up to four quarters).",
    "The FCIs outperform:",
    "Recent dynamics summarized:",
    "Policy-relevant implication:",
    "Title: A Financial Conditions Index for South Africa",
    "Authors: Nombulelo Gumata, Eliphas Ndou, Nir Klein",
    "Publication date: August 1, 2012",
    "Series: IMF Working Papers",
    "Working Paper No.: 2012/196",
    "Issue: 196",
    "Volume: 2012",
    "Pages: 20",
    "DOI: https://doi.org/10.5089/9781475505450.001",
    "Stock No: WPIEA2012196",
    "ISBN: 9781475505450",
    "ISSN: 1018-5941",
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