RTTNews - South Africa's economy is expected to shrink 2% during 2009, the weakest performance since 1992, a report from the Bureau for Economic Research showed Tuesday. A mild positive GDP growth is seen in the third quarter. The bureau estimates a fairly muted growth of 2.7% in 2010.
The BER forecasts the CPI inflation to average 7.4% in 2009 before slowing to an average of 5.8% next year. BER's projections indicate that CPI inflation will remain above 6% through February 2010.
BER economist Hugo Pienaar said, In light of recent double-digit wage settlements in a number of sectors and indications that the worst of the domestic recession may have passed, the BER is of the opinion that there will not be any further interest rate reductions. BER expects the repo rate to remain at 7.5% for the foreseeable future.
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