Sept. 1 (Bloomberg) -- South Africa’s purchasing managers’ index stayed below 50 for the second consecutive month in August, signaling a continued contraction in manufacturing, Kagiso Tiso Holdings said.
The seasonally adjusted index gained for the first month in five, advancing to 46.7 from a two-year low of 44.2 in July, Johannesburg-based Kagiso said in an e-mailed statement today.
“From a gross domestic product growth perspective, the most concerning part of the latest PMI numbers is the sharp deterioration in near-term demand, as well as the downbeat expectations for future business conditions,” Kagiso’s Head of Research Abdul Davids said.
Africa’s largest economy grew at its slowest pace in almost two years in the second quarter as output of manufacturing, which makes up about 15 percent of the economy, and mining dropped. Growth slowed to an annualized 1.3 percent from 4.5 percent in the three months through March, Statistics South Africa said on Aug. 30.
While the business-activity index gained 10.7 points to 46.6, it remains “significantly below the strong reading of 55.2 recorded in June,” Kagiso said. The employment index at 43.1 indicated a “weak factory-sector job market,” it said.
South Africa’s jobless rate, the highest of 61 countries tracked by Bloomberg, increased to 25.7 percent in the second quarter.
--Editors: Gordon Bell, Nasreen Seria
To contact the reporter on this story: Franz Wild in Johannesburg at firstname.lastname@example.org.
To contact the editor responsible for this story: Andrew J. Barden at email@example.com.