South Africa’s real gross domestic product (GDP) at market prices on a quarter-on-quarter (q/q) seasonally annualised and adjusted basis rose by 3,1% in the first quarter of 2004 from a 1,3% increase in the fourth quarter of 2004, Statistics South Africa said on Tuesday.
On a year-on-year (y/y) basis first-quarter 2004 GDP was up 1,8% from the fourth quarter’s unadjusted 1,5%, the third quarter’s unadjusted 1,6% increase and the second quarter’s rise of an unadjusted 1,9%.
According to a survey of economists, South Africa’s first-quarter 2004 GDP growth was expected to have more than doubled to a median forecast of 3,2% on a q/q seasonally annualised and adjusted basis.
The range of forecasts was from 2,5% to 3,9%. The growth rate on a y/y basis was expected to be in a range of 1% to 1,7% with a median of 1,5%.
The following are economists’ reactions to the data.
Dawie Roodt, chief economist at Efficient Group: “The numbers were much better than we expected and we will have to adjust our numbers for the year upwards. The data confirms my view that the Reserve Bank has to increase short-term interest rates in the second half of the year. But it is good news — well done, South Africa.”
George Glynos, market analyst at Econometrix Treasury Management: “The GDP figure is in line with my expectation, but slightly below the market expectation. I don’t see the market reacting much to the data. The latest data shows that the manufacturing sector is coming to grips with the strong rand. The finance and real-estate sectors are also benefiting from the low interest rates. Overall, the South African economy is staging a broad-based recovery.”
Johan Botha, economist at Standard Bank: “This is good news. We can safely say that growth was even higher than figures show, but then we’ll only know for certain when figures are revised. This set of data is in line with economists’ consensus. The turnaround in manufacturing supported the growth. With regards to the foreign exchange, maybe the rand is not having such devastating effects as previously imagined. We’re not doing as badly, it would seem.”
Johan Rossouw, chief economist at Vector Securities: “The numbers are in line with our forecasts. Manufacturing is up very strongly and this obviously contributed to the quarter-on-quarter figure. But otherwise the figure is not too much of a surprise.” — I-Net Bridge