SA’s factories seem to be returning to health
Manufacturing output grew faster than expected in August, indicating SA may be recovering from a recession
South African manufacturing output grew 1.3% in August from the same month in 2017, a slowdown from July’s 2.8% but beating the economists’ consensus of 0.6%.
The August figures indicate that the manufacturing sector will help SA’s third quarter GDP rebound from a recession in first and second quarters.
Statistics SA reported on Thursday that its manufacturing production index, which was set to 100 points in December 2015, rose to 106.5 points in August from 105.1 points in the same month in 2017. The increase from July’s 103.1 points was 3.3%.
The three-month, seasonally adjusted average came to 1.9% — a recovery from the 0.3% decline manufacturing contributed to SA’s second quarter GDP. SA’s overall GDP declined 0.7% in the second quarter and 2.6% in the first quarter.
Statistics SA was scheduled to release August’s mining production and sales report on Thursday morning, but said it has been delayed by a week because the department of mineral resources had failed to provide the figures on time.
Measured in current prices, total sales from SA’s factories in August came to R204.6bn, up from July’s R196.5bn and R188.7bn in August 2017.