AGGREGATE real gross domestic expenditure fell further in the fourth quarter of 2013 amid slower growth in spending by households and investment by the private sector, the Reserve Bank’s quarterly bulletin for the fourth quarter showed on Wednesday.
Real gross domestic expenditure declined to an annualised 3.6% in the fourth quarter of 2013 from a 0.8% decline in the third quarter. For 2013 as a whole, gross domestic expenditure growth moderated to 2.2% from 4% in 2012.
Real final consumption spending by households increased at a slower pace in the fourth quarter due to rising inflation and tighter lending conditions, the Bank said. Household consumption expenditure increased an annualised 2% in the fourth quarter after having increased 2.1% in the third quarter. Growth in spending by households moderated to 2.6% in 2013 after increasing by 3.5% in 2012.
Household incomes continued to be negatively affected by rising inflation, the adverse effect of widespread labour unrest and a deterioration in the country’s terms of trade, the Bank said. These were the main factors that saw household disposable income growth slow to 2% in the fourth quarter from 2.1% in the third quarter. The moderation was much more pronounced on a year-on-year basis. Growth in real household disposable income moderated more noticeably from 3.9% in 2012 to 2.5% in 2013.
The ratio of household debt to disposable income fell from 75% in the third quarter to 74.3% in the fourth quarter of 2013.
Real final consumption expenditure by general government edged higher to 2% (from 1.5%) in the fourth quarter, while real gross fixed capital formation by private business enterprises slowed in the final quarter amid moderate growth in real outlays in the manufacturing sector.
Growth in real fixed capital expenditure by public corporations improved marginally to an annualised rate of 0.8% in the fourth quarter mainly due to spending by the electricity and transport sectors.