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• Create Date September 8, 2026
• Last Updated September 8, 2026

Gross Fixed Capital Formation 2nd Quarter 2026

GDP growth slipped by 0.2% q-q in 2026Q2, as a weaker mining, manufacturing and trade sector weighed in on economic growth. Agriculture showed a moderate q-q increase, electricity managed to increase by 1%, with construction up 0.4%, slightly stronger from the 0.2% increase recorded in the previous quarter.

Fixed investment levels weakened in Q2, down 1.7% from Q1, but was up by 1.5% compared to the same period in 2025.  Investment by Public Corporations increased by 1.5% q-q, with weaker levels reported by general government and the private sector.  The picture looks slightly different when compared to the same period in 2025, with government investment levels close to 8%, SOE's by 17%, against a 2.5% y-y contraction by the private sector. Business confidence levels slipped by 17% to 39 in Q2 from 47 in Q1, and the impact of this is clearly shown in the muted investment levels. For the Q3 confidence levels slowed further to 38, which means we cant really expect a strong recover in the broader private sector any time soon.

Fixed investment as a percentage of GDP stabilised at 13.6% , on par with Q1, remaining at near record lows. Public sector investment also stabilised at 4.2% of GDP.

Investment in construction ended flat in Q2 and was 0.7% lower compared to 2025Q2. There were some interesting developments within the market segments however, with residential investment showing the strongest q-q increase (+3.9%), as investment in non-residential buildings and civil construction declined.  Compared to last year, residential investment was still lower (-6%), no change in construction works following the 4.8% increase in Q1, with only the non-residential sector showing an increase, up 7% and the second consecutive quarter of improved investment levels in real terms.   On the upside the rate of decline in total construction investment has slowed from -1.8% y-y in Q1 to -0.7% in Q2, but has certainly not met the growth expectations given governments commitment to increase infrastructure expenditure, that we have not really seen even in economic infrastructure, or construction works.

Industry Insight's construction pipeline has shown a contraction in tenders and approvals during 2025, that is expected to have an impact on construction during 2026, as fewer projects were ready for delivery. The pipeline has however improved in the last two quarters, up 3.2% y-y in Q1 and 7.4% in Q2, measured over a running twelve-month period. Effectively this means the pipeline is around R13bn larger, but is still vulnerable to delays, postponements and cancellations.

 

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