Overview
- Statistics South Africa confirmed on Tuesday that real GDP rose 0.5% quarter‑on‑quarter in Q1 2026, marking a sixth straight quarter of expansion.
- Growth was led by finance, real estate and business services, agriculture, trade and transport while manufacturing fell 0.8% and was the only sector to subtract from headline growth.
- On the demand side, weaker imports plus small rises in household and government spending and exports supported GDP, but gross fixed capital formation (investment) fell 1.1%.
- Economists and banks warn that the Iran‑related Middle East conflict and the April spike in fuel prices have already dented business confidence and are likely to slow growth and lift inflation in Q2 and beyond.
- High overall unemployment and acute youth joblessness remain a major constraint, inventories were drawn down to meet Q1 demand, and Stats SA says Q2 effects may show up in the September 8 GDP estimates.