South Africa's economic growth was 2.1% (quarter annualised) for the 1st quarter of 2008, considerably lower than the 5.3% growth in 4Q07. A sharp contraction in the mining sector and a decline in the manufacturing sector were the main reasons for the slowdown. GDP growth is expected to slow further during the rest of 2008 under the impact of higher interest rates, supply bottlenecks and lower global and local demand. However, no interest rate relief can be expected as the SARB is firmly focussed on bringing CPIX inflation back into the 3% to 6% target range.