South Africa’s real GDP at market prices on a quarter-on-quarter (q/q) seasonally annualised and adjusted (saa) basis rose by 3,3% in the fourth quarter of 2005 from 4,2% in the third quarter, Statistics South Africa (Stats SA) said.
This brought the annual average real growth for 2005 to 4,9% compared with 4,5% in 2004.
The median forecast for the fourth quarter was 4% q/q saa with a range of 3,5% to 5%.
The median forecast for 2005 was 5%, which is the government’s forecast given in the February 15 Budget. The forecast range was from 4,8% to 5,2%.
Mike Schussler, an economist at T-Sec, said the figure was a “bit of a disappointment — in fact it’s a big disappointment”.
“The first quarter of this year isn’t going to be much better what with the Transnet
strikes and the electricity problems — especially in the Western Cape.
“For bonds the figure will be good. It’ll be neutral for the rand but bad for the JSE.
“The annual average real growth for 2005 figure was as expected. But it is difficult to see how we could pick up momentum this year.”
Echoing Schussler, Dawie Roodt, the chief economist at the Efficient Group, said the number had been worse than they had expected.
“For the year, everyone was looking for the magical 5% number and it’s unfortunate
we couldn’t get it. Five percent would have been nice. From a sentiment point of view, this is probably not going to be so nice for the market.”
George Glynos, a market analyst at Econometrix Treasury Management, said the figure was a little softer than they had anticipated.
“Not a great number at all. I haven’t really had a chance yet to study the breakdown, but I see the mining and manufacturing sectors did not perform particularly well, which is clearly an indication of the strength of the rand. A disappointing figure.”
Bonds failed to react on Tuesday, as the softness in the rand kept bonds on the back foot. – I-Net Bridge