JOHANNESBURG (Reuters) - Economic growth in South Africa is expected to have slowed to 2.4 percent in the first quarter from 3.2 percent in the previous quarter due to a slump in the mining and manufacturing sectors.
Twelve economists see GDP growth braking to 2.2 percent on an annual basis in the first three months of the year from 2.9 percent in the previous quarter, a Reuters poll showed.
"GDP growth is likely to have slowed in Q1, with poor exports dragging overall economic growth down," said Annabel Bishop, an economist at Investec.Statistics South Africa is due to release economic growth figures for the first quarter on Tuesday.
The Purchasing Managers' Index (PMI), a key pointer to manufacturing activity, fell for a second straight month in April to 53.7 from 55.1 in March.
The fall in the PMI suggests that the second-largest contributor to South Africa's gross domestic product could be struggling despite recent signs of the economy slowly recovering from a recession in 2009.
Manufacturing output also contracted by 2.7 percent year-on-year in March from 4.0 percent in February.
"The poor performance in mining should constrain overall GDP growth. Agriculture is likely to be the swing factor," said Razia Khan, head of Africa research at Standard Chartered Bank.
However, robust growth in retail sales, helped by 18-months of record low interest rates, should provide a boost to the headline number, she added.
The central bank, which cut rates by 650 basis points from 2008 to 2010, sounded a dovish note in its latest policy statement on Thursday, lowering its inflation forecast to an average 6.0 percent in 2012, and said GDP growth would hit 2.9 percent.
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Twelve economists see GDP growth braking to 2.2 percent on an annual basis in the first three months of the year from 2.9 percent in the previous quarter, a Reuters poll showed.
"GDP growth is likely to have slowed in Q1, with poor exports dragging overall economic growth down," said Annabel Bishop, an economist at Investec.Statistics South Africa is due to release economic growth figures for the first quarter on Tuesday.
The Purchasing Managers' Index (PMI), a key pointer to manufacturing activity, fell for a second straight month in April to 53.7 from 55.1 in March.
The fall in the PMI suggests that the second-largest contributor to South Africa's gross domestic product could be struggling despite recent signs of the economy slowly recovering from a recession in 2009.
Manufacturing output also contracted by 2.7 percent year-on-year in March from 4.0 percent in February.
"The poor performance in mining should constrain overall GDP growth. Agriculture is likely to be the swing factor," said Razia Khan, head of Africa research at Standard Chartered Bank.
However, robust growth in retail sales, helped by 18-months of record low interest rates, should provide a boost to the headline number, she added.
The central bank, which cut rates by 650 basis points from 2008 to 2010, sounded a dovish note in its latest policy statement on Thursday, lowering its inflation forecast to an average 6.0 percent in 2012, and said GDP growth would hit 2.9 percent.
yahoo.com
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