Manufacturing growth far lower than expected
Manufacturing production grew just 0.3% in January 2019, far below the Bloomberg consensus of 1.2%
The manufacturing sector saw tepid growth at the start of 2019.
Manufacturing production grew just 0.3% in January 2019, far below the Bloomberg consensus of 1.2%, after subdued growth of 0.1% in December 2018.
The biggest growth drivers were a 2.9% rise in food and beverages, and a 0.9% uptick in petroleum, chemical products, rubber and plastic products.
Statistics SA’s manufacturing production index, which was at 100 points in 2015, came to 87.7 points in January, down from 93.8 points in December.
Miyelani Maluleke, an economist at Absa, spoke with Business Day TV about what the latest data suggest about the direction of the manufacturing sector moving forward.
The monthly changes in factory output measured by Statistics SA usually tend to be foreshadowed by the Absa-sponsored purchasing managers index (PMI), which is published on the first business day of each month.
The PMI, which gauges activity in the manufacturing industry, eased to 49.9 points in January 2019 after reaching its highest level for 2018 of 50.7 in December — the first time since May 2017 that the index breached the neutral 50 mark.
However, in recent months, the PMI and production figures have not been in tandem.