Stats SA: GDP falls 1.2% in first quarter of 2016
Stats SA explains that a sharp contraction in mining tipped economic growth into negative territory.
JOHANNESBURG - Statistics South Africa says the economy contracted by 1,2 percent in the first quarter of this year.
This after an 18.1 percent contraction in the mining and quarrying sectors.
Economists had expected the economy to contract by 0.1 percent.
Argon Asset Management economist Thabi Leoka says agriculture is a worrying sector.
"There was a huge contraction in mining production of 18,1 percent and this was because of slow production. We also saw a decline of about 6,5 percent in agriculture. The sector is an interesting one because it's the fifth consecutive quarter where we've seen negative growth."
The rand was volatile, first extending losses against the dollar after the gross domestic data was released, but later firmed after Fitch retained the country's investment grade BBB- rating and kept the outlook stable.
GDP also shrank by 0.2 percent on an unadjusted year-on-year basis in the first quarter, compared with 0.6 percent growth in the previous three months, the agency said.
Additional reporting by Reuters.