Event

The latest data from the Bank of Guyana (the central bank) points to a slowing in economic activity through mid-2015, due mainly to lower mining output. However, banks have responded to rising household incomes by boosting their lending. Inflationary pressures are minimal.

Analysis

The central bank noted that real economic growth slowed to 0.7% in the first half of 2015, down from 4.8% in the corresponding period of 2014. The slowing is largely due to a 17.4% contraction in the mining and quarrying sector, with lower prices for bauxite and gold (and falls in production of 14.8% and 16.2% respectively). The agricultural sector grew by 4% as a fall in output of forestry and fishing was more than offset by expansion elsewhere: rice production, for instance, was nearly 360,000 tonnes, or 15.3% higher than it had been in the first six months of 2014.