South Africa: PMI inches up in July
The S&P Global South Africa Purchasing Managers Index (PMI) improved to 49.3 in July from 49.2 in June. As a result, the index remained below the 50.0 no-change threshold but signaled a softer deterioration in private-sector operating conditions compared to the previous month.
July saw both output and new business contracting at the steepest pace in four months due to weaker sales and increased supply-side pressures. Such challenges as domestic and international port congestion exacerbated delivery times, leading to the fastest deterioration in vendor performance in five months. Consequently, businesses opted to deplete their inventories to manage backlogs, indicating a cautious approach amid ongoing demand and supply challenges.
On the pricing front, July saw input cost inflation pick up slightly, while output price increases were the softest in nearly four years. Lastly, business sentiment improved to a near two-and-a-half-year high, driven by expectations of political stability post-general election, reduced load shedding and softer price pressures, which firms believe could support future growth and demand improvements.