Trade conditions remained stable but subdued in October and are expected to continue as such for the next six months, the South African Chamber of Commerce and Industry (Sacci) said on Thursday.
Thought all components of trade conditions were on better levels than September, except for inventories and input cost, the trade index remained below 50.
"The seasonally adjusted Trade Activity Index (TAI) that reflects present conditions, improved to 42 in October – up from 40 in September 2019. Trade conditions are also expected to remain even over the next six months but subdued. The seasonally adjusted Trade Expectations Index (TEI) remained at 44 in October but was 3 index points better than a year ago.
Inventories was one index point lower than September, and input cost rose by six index points from last month.
New orders and sales volumes were notably higher and supplier deliveries were improving, Sacci said.
"Trade activity components are expected to remain steady to positive over the next six months."
It cautioned that the unpredictability of sales and input prices was expected to continue over the next six months.
"Seventy-three percent of respondents expect rising sales prices while 76 percent expect input costs to increase. Slack demand in the economy is containing inflationary pressures. Unchanged inventory levels reflect the uncertainty and subdued trade environment," Sacci said.
"The volume of retail sales, the decline in real house prices and tight merchandise export and import volumes mirror the current trade environment and [an] underperforming economy."