GDP GROWTH
SA narrowly averted recession but consumers still wary
Analyst says consumers are slightly better off but still not spending because of confidence shock
SA may just have avoided a technical recession, despite the weaker than expected performance of the retail and manufacturing sectors, but consumers are still under strain. A technical recession is based on two consecutive quarters of negative growth. With a contraction of 0.3% in GDP growth last quarter, a contraction in the first quarter of 2017 would place SA in a technical recession. The general consensus is that economic growth has slowed but it is likely SA has avoided a recession. Contractions in the retail and manufacturing sectors of 1.1% and 0.9% respectively will weigh on the first quarter’s GDP but economists say that stronger activity in the mining (up 3.5%) and agricultural sectors (food prices were down 2.1% in April) outweighed the drags. "We expect to have cleanly escaped a technical recession in the first quarter of this year," says Standard Bank economist Thanda Sithole. The mining sector is expected to continue to benefit from higher commodity prices and favourabl...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.