PMI hits six-year highs

Johannesburg - purchasing managers' index (PMI) rose in August to its highest level in six years on improving demand in the manufacturing sector, a survey showed on Monday.

The PMI, a measure of factory activity, was at 56.5 in August from 52.2 in July, its highest since August 2007, according to data from the survey's sponsor .

It is the fifth straight month the index has stayed above the 50 point mark which indicates expansion. A score below 50 indicates contraction.

"We may be seeing the first signs of import replacement as the weaker rand improve the competitiveness of locally-manufactured goods, versus more expensive imported goods," said Abdul Davids, head of research at Kagiso Asset Management.

"In addition, the sustained weakness in the currency has improved the global competitiveness of our exports of manufactured goods."