SA’s economic woes deepen
Blow to sentiment as GDP contracts again: the last time the country posted four straight quarters of growth was in 2013
SA has been dealt another blow with news that the economy contracted again in the third quarter, and that the country’s trend growth appears to be flagging.After rebounding by a revised 3.2% quarter on quarter (q/q) in the second quarter of 2019, following a 3.1% contraction in the first quarter, the economy contracted by 0.6% q/q between July and September — confounding economists, most of whom had expected growth of 0.8%.The big undershoot will have many economists scrambling to revise down their whole-year forecasts. For Capital Economics’ John Ashbourne, it confirms that the pace of SA’s trend growth has "slowed markedly". The last time SA posted four straight quarters of growth was in 2013.The Reuters consensus is for growth to average 0.6% this year; the National Treasury is looking at 0.5%. The consensus is likely to drop to at least 0.5%, but this assumes growth will lift in the final quarter. A worse outturn will have a knock-on effect on the fiscus, since it implies reven...
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