South Africa’s economy shrank in the third quarter as logistics constraints and a chronic electricity shortage took their toll.
GDP contracted 0.7% in the three months to end-September, compared with growth of 1.5% in the prior quarter, Statistics South Africa said in a report on Tuesday. The median estimate of 11 economists in a Bloomberg survey was for output to shrink 0.1% in the period.
The slump follows a 2.2% annual contraction in mining and a 3.2% slowdown in utilities over the three-month period.
Household spending, which has come under pressure from high living and borrowing costs, shrank 0.3% in the quarter. The Reserve Bank has increased its benchmark rates by 475 basis points since November 2021 to a 14-year high of 8.25%.
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For the nine months to September, GDP grew 0.3% compared with the previous year, an early indication that growth may underperform the 0.8% forecasts for the year from national treasury and the Reserve Bank. — Ntando Thukwana, (c) 2023 Reuters
