Insights
By: Bryn Hatty
South African Q3 2025 Investment Outlook
South African assets delivered strong returns in Q3, driven by a favourable combination of global and local factors.
A weaker US dollar and surging gold prices improved South Africa’s terms of trade, supported the rand, and strengthened fiscal outcomes. The upcoming MTBPS will be a key event, with markets watching for signals of continued fiscal discipline and reform momentum. The South African Reserve Bank’s move toward a lower inflation target has anchored expectations and supported fixed income markets.
Equity market gains were highly concentrated in a handful of resource and tech-linked stocks, making it a challenging environment for diversified active managers. Foreign investor flows returned to the bond market, while equity flows remained negative overall, with selective buying in certain sectors. The political landscape remains fluid, with the ANC facing internal challenges and coalition politics likely to shape the outlook ahead of the 2026 local elections.
Our approach remains deliberately diversified, prioritizing capital preservation and risk management as we navigate an environment of both opportunity and uncertainty.
DISCLAIMER
This document is intended to provide only general information and to highlight points of interest. The information does not constitute legal, tax, or investment advice. You must not, therefore, rely on the content of this document when making any investment decisions and you may wish to consult an independent professional. Our expectations and beliefs are based on reasonable assumptions within the bounds of what we currently know. Clients have an obligation to provide Stonehage Fleming with accurate information, material facts or statements and must inform Stonehage Fleming of any information relating to the client’s change in financial circumstance, investment objectives and risk profile to enable us to make the necessary adjustments.
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Where investments are involved, nothing in this document should be taken as expressed or implied indication, representation warranty or guarantee of performance whether in respect of income or capital growth. The value of investments may go down as well as up and, for products designed to return income, the distributions can also go down or up and you may not receive back the full value of your initial investment. Past performance is not a reliable indicator of future results. Forecasts are not a reliable indicator of future performance.
Collective investment schemes are generally medium to long-term investments. Collective investment schemes are traded at ruling prices and can engage in borrowing and scrip lending.
There are potential material risks associated with investing in foreign securities which include but are not limited to: potential constraints on liquidity and the repatriation of funds, macroeconomic risks, political and social instability, foreign exchange risks, tax risks, settlement risks and potential limitations on the availability of market information, all of which may have an impact on performance. Where an investment is denominated in a currency other than the currency where the investor is resident, investment returns may increase or decrease because of currency fluctuations.
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Download 'SFIMSA Quarterly Investment Letter Q3 2025'