Business conditions in the manufacturing sector improved in August as SA moved to level 2 of the coronavirus lockdown, according to the Absa manufacturing purchasing managers’ index (PMI).
The Absa PMI increased to 57.3 index points in August from 51.2 in July, data showed on Tuesday.
The PMI measures activity in the manufacturing sector and a score below 50 points indicates contraction. The sector accounts for about 13% of GDP.
Business activity and new sales orders rose in August as economic activity picked up as lockdown restrictions eased, while the employment and inventories indices remained subdued.
“Despite the level of the PMI more than likely overstating the extent of the recovery, the renewed increase in the PMI in August is encouraging, especially as it seems to be supported by both local and export demand improving,” Absa said.
“Furthermore, purchasing managers have turned notably more optimistic about future business conditions,” it added.
The index tracking expected business conditions in six months’ time rose to the highest level in about 18 months. -Businesslive