2010.09.3011:02:00UTC+00Mauritius Cuts 2010 Growth Forecast

The Mauritian economy rebounded in the second quarter from a brief contraction in the first quarter, data from the Central Statistics Office showed Thursday. At the same time, the statistical office said that economic growth in the Indian Ocean island nation may come in weaker than earlier thought this year.

The seasonally adjusted gross domestic product grew 0.3% sequentially in the second quarter after suffering a 3.7% contraction in the first quarter. Year-on-year, the growth rate slowed to 3.8% during the three-months through June from an upwardly revised 4.2% in the previous quarter. The initial GDP growth rate for the first quarter was 3.6%.

The statistical office now sees 4.1% growth this year compared to 4.2% expansion projected in June. In 2009, the GDP rose 3.1%. The statistical office predicts output of export oriented enterprises to grow 1.9% this year after removing the price effects.

Growth rate of final consumption expenditure of households and government is seen at 2.5% in 2010 compared to 2.6% last year.

In the second quarter, final consumption expenditure increased 1.4% year-on-year, slower than the 2.1% growth in the first quarter. Final consumption expenditure of households grew 2%, while that of general government declined 1.2%. After a decline of 2.5% in the first quarter, investment picked up 4.7% in the second quarter.

Meanwhile, business confidence in the Mauritian economy declined during the third quarter as the index fell to 96.3 points from 96.7 points in June, reports said citing a survey by the Mauritius Chamber of Commerce and Industry.

On Tuesday, Bank of Mauritius governor Rundheersing Bheenick said that the central bank may keep its key policy rate unchanged at current level during the next two quarters, a day after slashing the benchmark repo rate by 100 basis points to 4.75% per annum.

The bank said that this substantial monetary easing will give further support to the on-going economic restructuring and provide the opportunity for embarking on a major drive to improve productivity and national competitiveness.

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