TUESDAY, 1.30PM:
ECONOMIC growth managed to hit just 0,7% in the first quarter, short of the levels required to meet Finance Minister Trevor Manuel’s annual target of 2,5%.
Manuel’s budget projections, which hoped for healthy growth, were based in part on optimism that there would be growth stimulated by an interest-rate cut this year. But the current vulnerability of the rand makes an interest rate increase more likely at the moment.
The increase to 0,7% from 0,3% in the previous quarter was largely powered by a 6,2% annualised real growth in the agriculture and forestry sector.
However, analysts are cautious about annualised quarterly growth figures, saying they exaggerate movements, and point to a year-on-year rate of GDP increase of 1%.
Sectors besides agriculture that performed moderately well were trade at 1,5% and the financial sector at 2,8%. Mining dropped 4,3%, largely to due to the suffering gold industry, which contributes 50% of the mining sector.