SA growth quickens

PRETORIA – South African third quarter growth rose to an annualised 4,7 per cent, beating forecasts and backing the case for another interest rate hike next week.

Statistics South Africa said growth accelerated from a downwardly revised 4,4 per cent in the second quarter from rapid expansion in the finance and construction sectors. Analysts had expected a slowdown to 4,2 per cent due to slower consumer demand on the back of higher interest rates.The unadjusted year-on-year figure was also above predictions at 5,1 per cent.”From a broad perspective it’s a very strong number.It’s a lot stronger than the market anticipated,” ETM economist Russell Lamberti said.”It certainly bodes (ill) for further interest rates hikes down the line.”South Africa’s central bank has raised its repo rate by 150 basis points to 10,5 per cent since June to tame accelerating inflation and strong consumer spending.The CPIX inflation rate moved further outside the bank’s three to six per cent band to 6,7 per cent year-on-year in September, raising speculation the repo could rise again next week.A further increase in inflation is forecast in data to be released for today.Statistics SA said financial services – the economy’s biggest sector – and construction remained the main drivers of growth, with manufacturing suffering from a stronger currency and strikes during the quarter.Nampa-ReutersAnalysts had expected a slowdown to 4,2 per cent due to slower consumer demand on the back of higher interest rates.The unadjusted year-on-year figure was also above predictions at 5,1 per cent.”From a broad perspective it’s a very strong number.It’s a lot stronger than the market anticipated,” ETM economist Russell Lamberti said.”It certainly bodes (ill) for further interest rates hikes down the line.”South Africa’s central bank has raised its repo rate by 150 basis points to 10,5 per cent since June to tame accelerating inflation and strong consumer spending.The CPIX inflation rate moved further outside the bank’s three to six per cent band to 6,7 per cent year-on-year in September, raising speculation the repo could rise again next week.A further increase in inflation is forecast in data to be released for today.Statistics SA said financial services – the economy’s biggest sector – and construction remained the main drivers of growth, with manufacturing suffering from a stronger currency and strikes during the quarter.Nampa-Reuters