Business confidence is down slightly in July, the South African Chamber of Business said on Thursday.

The chamber said that domestic demand and consumer confidence remained at strong levels throughout July, in spite of the country’s stricter monetary. SACOB predicts that constricting the monetary policy is of domestic necessity, and will directly and indirectly affect business confidence in upcoming months.

SACOB’s economist Richard Downing said that “although world markets seem to be resilient and hesitant on prospects for the global economy, global developments are of special importance to South Africa in terms of capital flows and the assessment of the South African economy within the global context.”

The Business Confidence Index declined a further 0.3 index points from 99.4 in June to 99.1 in July, following a two point decline in May. However, the BCI seemed to be in a “wait-and-see” mode as there was a balanced impact of the sub-indices in July, according to SACOB.

The exchange rate of the rand might influence the country’s economic growth and cause further inflation on fuel, the chamber said.

SACOB also noted that imports of investment goods such as machinery, mechanical appliances and electrical equipment, have increased.