SA GDP grows by 3.3% in Q2

Lesotho Times - - Business -

JOHANNESBURG — South Africa’s econ­omy grew by an an­nu­al­ized 3.3 per­cent in the sec­ond quar­ter, thanks to a sharp in­crease in man­u­fac­tur­ing ac­tiv­ity and a re­cov­ery in the min­ing sec­tor, the coun­try’s statis­tics of­fice said Tues­day.

The rise in gross do­mes­tic prod­uct, South Africa’s largest since the fourth quar­ter of 2014, fol­lows a 1.2 per­cent con­trac­tion in the first three months of the year.

It may take some pres­sure off the govern­ment of Pres­i­dent Ja­cob Zuma, who is in a pro­tracted bat­tle with his fi­nance min­is­ter, Pravin Gord­han over the fu­ture di­rec­tion of Africa’s most de­vel­oped econ­omy.

The GDP jump was driven by a 8.1 per­cent in­crease in the man­u­fac­tur­ing sec­tor, which con­trib­uted 1 per­cent­age point to over­all growth, the statis­tics of­fice said. South Africa ex­panded its pro­duc­tion of pe- troleum prod­ucts, chem­i­cals as well as cars and other trans­port equip­ment.

The min­ing and quar­ry­ing sec­tor, es­pe­cially for plat­inum, added an ex­tra 0.8 per­cent­age point, thanks to a 11.8 per­cent jump in in­come there.

A con­tin­u­ing drought and wa­ter re­stric­tions in some parts of the coun­try were partly to blame for de­clines in out­put from agriculture, forestry and fish­ing as well as the elec­tric­ity, gas and wa­ter sec­tor, the statis­tics of­fice said.

The un­ex­pect­edly large in­crease in GDP will shift the fo­cus to the next mone­tary pol­icy meet­ing of the South African Re­serve Bank on 22 Septem­ber. At its last meet­ing in July, the bank low­ered its growth fore­cast for the year to zero from 0.6 per­cent pre­vi­ously, say­ing it ex­pected only a lack­lus­ter re­cov­ery. — WSJ

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