South Africa entered recession in the second quarter for the first time since 2009, according to data released on Tuesday by the country’s Statistician-General, Risenga Maluleke.
The statistics show that Africa’s second largest economy contracted by 0.7 percent in the second quarter, led by declines in the agricultural, transport and retail sectors.
This comes despite forecasts of analysts that the economy would grow 0.6 percent in the latest quarter.
“We are in a recession. We reported a contraction in the first quarter … and now in the second quarter with a fall of 0.7 percent,” Maluleke said.
The rand stretched losses against the dollar to more than 2 percent while government bonds fell.
Agricultural output fell 29.2 percent in the second quarter, while the transport, communication and storage sector fell 4.9 percent.
On the positive side, however, mining output grew by 4.9 percent and finance by 1.9 percent.
Stats SA also said the economic contraction in the first quarter was steeper than initially recorded, at 2.6 percent.
Analysts opine that the dismal data would likely make it harder for the South African Reserve Bank to raise interest rates at its upcoming meetings.