JOHANNESBURG – Data from the Standard Bank Purchasing Managers Index (PMI) shows that export orders grew for the first time in 16 months in January.
Agricultural products were among those attracting higher export orders in the period.
The figures also showed that employment rose for the second straight month, while backlogs decreased the most in 13 months in the period.
However, January’s headline reading pointed to the seventh straight month of contraction in private sector activity, albeit it was the weakest contraction since June. The headline PMI rose to 49.6 points last month, from 49.0 points in December, to record its highest reading since June 2018 when business conditions last improved.
David Owen, economist at IHS Markit, said there were positive signals for South African businesses at the start of the year, with the PMI edging close to stabilisation and export orders growing for the first time since late 2017.
Data from the Absa Manufacturing PMI released on Friday showed that factory activity in South Africa began the year in contraction with the index slipping from 49.9 points in January from 50.7 points in the previous month.
However, the expected business conditions index, which tracks expected business conditions in six months’ time, registered a third consecutive improvement in January,
rising by 15.7 index points to clock in at 67.2 points – the best level since April 2018.