Absa PMI shows factories still under pressure, and no relief in sight
The Absa purchasing managers index (PMI) picked up slightly in August but still showed a sector under pressure. The index rose to 44 index points in August, after slumping to 42.9 in July — the lowest level since the 2009 financial crisis. The index has struggled to climb above the neutral 50-point mark after falling below it in June. A score above 50 indicates an expanding manufacturing sector. The improvement was broad based, with four of the five main subcomponents increasing. Absa said on releasing the latest index on Friday: "Despite ticking higher, the key subindices remained below the neutral 50-point mark. "This suggests that the manufacturing sector is still under significant pressure and does not bode well for manufacturing output (and overall GDP) in the third quarter of 2017." Absa also noted that respondents are notably more pessimistic about business conditions going forward. Expected business conditions in six months’ time declined from 51.3 to 46.6 points in August —...
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