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Slower state spend offsets household growth

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Pretoria - Spending in South Africa grew at an annualised 0.3% in the fourth quarter of 2014 after rising 3.2% in the prior quarter, with slowed government spending offsetting accelerated growth in household spending, the South African Reserve Bank (Sarb) said on Tuesday.

The Sarb said in its quarterly bulletin that spending by the government increased at an annualised 1.0% in the final quarter against 1.4% in the third quarter.

However, household spending grew at an annualised 1.6% from 1.1% quarter-on-quarter.

"The higher level of spending by consumers can be ascribed to an increase in the disposable income of the household sector following a moderate rise in compensation of employees over the period," the Reserve Bank said.

But on a year-on-year basis, household spending grew at a slower rate of 1.4% in 2014 from 2.9% in 2013 as striking workers in the mining and manufacturing sectors went without salaries, among other issues.

Last year's annual increase in household spending was the lowest rate of growth since 2009, Sarb said.

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