Johannesburg - Trade conditions tightened in August because of a less favourable environment, the SA Chamber of Commerce and Industry (Sacci) said on Wednesday.
Sacci's trade activity index (TAI) dropped from 61 in April to 52 in August.
The seasonally adjusted TAI decreased by three points from July to 53 in August.
The trade expectations index (TEI) declined from 64 to 61 over the same period.
Sales volumes and new orders indices declined by nine and 12 points respectively.
Supplier deliveries dropped by five points to 48 in August.
“... There are concerns of increasing pressures on this index due to the impact of strikes,” Sacci economist Richard Downing said.
“Inventory increases were caused by the much lower sales volumes, while backlogs on orders also eased.”
In August, 65 percent of the survey's respondents indicated lower sales prices compared to 66 percent in June, and 77 percent experienced rising input costs in August, similar to July.
The 77 percent was notably higher than the 69 percent in August 2011, and 66 percent last year.
Fuel prices, administered prices, and prices of imported goods contributed to the cost-push inflation.
“Excessive wage demands in the current context will aggravate the inflationary process and lead to even tighter trade conditions as well as have adverse implications for employment creation,” said Downing.
Employment conditions in the trade sector remained stable in August at 51.
However, employment prospects declined from 52 in July to 51 in August “suggesting a stagnant, but stable employment situation in the trade sector in the short-term”, said Downing. - Sapa