Key data suggests SA’s economy has averted a technical recession

South Africa’s economy is likely to have averted a technical recession in the third quarter despite record power outages, key data indicates.

Better-than-expected mining and manufacturing output is set to outweigh relatively soft retail sales data, suggesting Africa’s most industrialised economy returned to growth in the third quarter after contracting 0.7% in the prior three-month period. Mining and manufacturing make up about a fifth of total gross domestic product, while trade, which includes the retail sector, accounts for 13%.

“It’s going to be close but we do escape a technical recession,” said Sanisha Packirisamy, an economist at Momentum Investments, whose GDP tracker implies quarterly growth of 0.1% to 0.4%. “Growth is reasonably soft and load-shedding has been one of the main factors driving that together with increased headwinds that the consumer is facing,” she said using a local term for power outages