The Steel and Engineering Industries Federation of Southern Africa (SEIFSA) welcomes the latest ABSA Purchasing Managers’ Index (PMI) data, which reflects an increase in overall business activity in the broader manufacturing sector for March 2020.
The composite PMI data for March 2020 shows that industrial activity improved to 48.1 points, up from the 44.3 points recorded in February 2020, moving the index closer to the benchmark level of 50, which separates expansion from contraction.
Speaking after the release of the data this morning, SEIFSA Economist Marique Kruger said it is also encouraging to note that the majority of the seasonally-adjusted sub-components correspondingly registered increases in March 2020 when compared to February 2020.
Of the five sub-components, the supplier performance sub-index increased the most, surging from 58.6 points in February 2020 to 67.4 points in March 2020, while the worst-performing sub-index was the business activity sub-index, decreasing from 33.7 points in February 2020 to 30.7 points in March 2020.
Despite the improvement, Ms Kruger said that the PMI trend is still very volatile, highlighting the underlying constraints facing businesses.
“Companies still have to deal with fluctuating input costs, increasing energy costs, volatility in the exchange rate and the global corona virus pandemic,” she said.