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December 2011 | Angeline Albert
South
Africa’s Kagiso PMI showed marginal growth in November, with activity rising by
1.1 index points to 51.6.
The
figure, released today, is however below the 54.2 reached before July’s factory
strikes.
November
showed the fourth consecutive month of gains, indicating manufacturing will
contribute to GDP growth in the last quarter. Employment levels showed some
improvement but at 46.5 remained below the crucial 50 mark that separates
growth from contraction.
The
new sales orders and inventory index indicated purchasing managers expected
demand to be stronger than it turned out to be, with buyers purchasing inputs
in anticipation of increased demand, which did not materialise. This was
reflected by
November’s
new sales orders index which eased marginally by 0.4 points to 51.2, while the
inventory index rose by 3.3 index points to reach 54.4.
South
Africa’s November PMI goes against the trend for its major trading partners.
The Markit Eurozone flash PMI estimate for November came in at only 46.4, a
weaker performance than the 47.1 recorded during October and the HSBC Chinese
flash PMI fell to a 32-month low of 48. These weak global PMI results question
the sustainability of South Africa’s domestic PMI recovery. The uncertain
outlook is reflected in the expected business conditions index, which declined
by 7.4 points to 55 – the lowest level since August 2011.
