Citadel Chief Economist Maarten Ackerman said that although the technical recession of two consecutive quarters of contraction heightened South Africa's risk of suffering yet another credit downgrade in the second half of the year, he expected an upside surprise in the second half.
Nene was speaking on the sidelines of the Forum on China Africa co-operation in Beijing.
Stats SA said the 0.7% downturn in the second quarter of 2018 was a result of a fall-off in activity in the agriculture, transport, trade, government and manufacturing industries. South African national currency, the rand, extended declines against the United States dollar to more than two percent as government bonds fell after the released data.
The second-quarter gross domestic product (GDP) reading was much worse than the 0.6 percent expansion analysts had predicted.
The recession in which South Africa now finds itself, due to the contraction of the country's economy in the second quarter of 2018, points to the ANC government's inability to ensure economic stability.
The economy unexpectedly contracted an annualised 0.7% in the second quarter from the previous three months, Statistics South Africa said in a statement on Tuesday.
On the positive side, however, mining output grew by 4.9 percent and finance by 1.9 percent.
For years, South Africa has struggled to grow and record unemployment of 27.7%.
Steinhoff bucked the negative trend, rising 5.73 percent after former chief executive Markus Jooste's appearance at a parliamentary inquiry, claiming no knowledge of any accounting irregularities at the time of his departure in December.
The GDP figures could also draw the attention of ratings agencies, who have South Africa's sovereign ratings near "junk" status.
Head of research at ETM Analytics, George Glynos, said the recession was a function of years of maladministration.
The currency has now wiped out all the gains it made after Cyril Ramaphosa replaced Jacob Zuma as the country's president in February. "But, that said, the tightening of global financial conditions imply countries running macroeconomic imbalances will be placed under closer scrutiny by investors, especially if imbalances reflect a weak fiscal position", he wrote. This was officially announced on Tuesday after the release of economic data by Statistics South Africa.
Investors have dumped South African bonds since August as an emerging markets sell-off picked up pace driven by concerns over the Turkish central bank's ability to rein in double-digit inflation, which has surged to almost 18 percent.