South Africa’s factories were less happy in August, according to the Absa PMI
A purchasing managers’ index (PMI) poll released on Monday revealed that South African manufacturing confidence declined in August following a brief uptick in July due to muted activity and weak domestic and export demand.
The Absa-sponsored seasonally adjusted PMI for South Africa dropped from 50.8 points in July to 49.5 points in August.
An activity contraction is indicated by a number below 50, and growth is indicated by a reading above 50.
Even if companies were not directly affected, respondents mentioned that tariffs hindered exports, which caused new sales orders to plummet, falling 8.5 points to 47.4 points.
Tens of thousands of jobs in industries including agriculture and auto manufacturing could be lost as a result of U.S. President Donald Trump’s 30% tariff on South African exports to the United States, which is the highest rate in Sub-Saharan Africa.
August saw a 1.3-point drop in the sub-index measuring business activity to 45.8, in part because of heightened competition from lower-priced imports.
Although respondents said that this was “due to declining orders, not as a result of improvements on the logistical front,” the supplier delivery sub-index also decreased.
Transnet, a state logistics organization, has trouble providing sufficient port and freight train services, which hinders important industries like mining.
