South Africa’s current account deficit shrank by more than expected in the fourth quarter, aided by an improvement in the trade surplus.

The gap on the current account – the broadest measure of trade in goods and services – narrowed to 0.4% of gross domestic product or R31.6-billion in the three months through December, from a revised 0.8% of GDP or R55.6-billion in the prior quarter, data released Thursday by the central bank showed.

The median estimate of five economists surveyed by Bloomberg was for a current account gap of 0.9% of GDP, or R70-billion.

The deficit for the year was 0.6% of GDP or R44.5-billion, compared with a gap of 1.6% of GDP in 2023. That was better than the 1.2% shortfall forecast by the central bank.

Driving the narrower quarterly deficit was a widening in the nation’s trade surplus to R232.9-billion from R200.4-billion in the third quarter, as the value of goods exported increased by more than that of merchandised imports.

The advance was driven by an increase in both the value and volume of exports, the central bank said, which noted a fourth-quarter improvement in the country’s terms of trade, as the rand price of exports rose while that of imports decreased.

For the whole of last year, the trade surplus more than doubled to R216.4-billion or 3% of GDP, from R103.4-billion or 1.5% of GDP in 2023.