Banking sector vulnerabilities in
In its April economic report, the
"Solvency concerns especially in smaller banks also remain a drag in the periphery, making the
"Growth in annual broad money edged up by 5,5% to reach
The bank said while a strong easing of prices of tradables was leading deflationary pressures, the prices of domestic non-tradables further strengthened, amidst falling aggregate demand and weakening of the Rand.
CPI inflation closed 2013 at 0.3 and continued on a downward trend, turning negative (-0.5%) in February and slid further to -0.9%in
The economy's outlook remains cloudy, slowed down by downside risks emanating from lower international prices of minerals, vulnerabilities in the banking sector, policy inconsistences affecting investment, deflationary pressures, fiscal slippages, the bank says.
"Growth in 2014 is expected at 3%, dragged by the headwinds from the global economy, low investment and weak growth of the mining sector. The carry over effects of the 2013 slowdown are also likely to weigh down on 2014 growth," the bank says.
The bank sees agriculture rebounding by 7,3% in 2014, largely supported by recovery in maize to 1,2 million tonnes. The first crop assessment estimates that 1,4 million hectares was planted to maize, an 18% increase from the previous season.
"Despite a reduction in hectarage, the cotton production is expected to register an improvement in 2014, benefiting from improved yields and favourable rains," the bank says.
"Gold production recovered by 0,6 percent to reach 2168 kg in the first 2 months of 2014. Platinum production dropped by 7 percent, reaching 2058kg, while nickel surged to 3117 tonnes, buoyed by scaled up production by
On the manufacturing sector, the
"Total revenue continues to underperform as it amounted to
Tax revenue fell 7,5% below expectations, sapped by underperformance of major taxes: income taxes (-6% especially companies), customs duties (-26%), excise duties (-9%), VAT (-19%). Non-tax revenue fell 11% below target to reach
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