Johannesburg - Output and new orders in South Africa's private sector declined at their sharpest rates in nearly a year as the economy weakened and demand subsided, a survey showed on Friday.
South Africa's Standard Bank Purchasing Managers' Index (PMI) fell to 49.2 in June from 50.1 in May, its lowest reading in 11 months.
Companies surveyed signalled they were cautious about their stock policies as activity contracted for the first time since January. New export orders continued to decrease, albeit at a slower rate than May' s 10-month record.
“The growth outlook for South Africa remains lacklustre as a combination of declining order intakes and falling purchasing activity suggests that the sector is likely to remain stuck in reverse gear,” said Oliver Kolodseike, an economist at Markit.
“Exchange rate factors, rising fuel prices and increasing staff costs meanwhile continued to exert upward pressure on overall input costs,” Kolodseike said.
Reuters