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Johannesburg - Trade conditions remained positive in April, the SA Chamber of Commerce and Industry (Sacci) said on Thursday.
This was despite a decline in Sacci's seasonally adjusted trade activity index (TAI), which lost eight points during the month to measure 51.
The non-seasonally adjusted TAI decreased by 12 points to 48 in April, but was at a higher level compared to April 2011, when the index stood at 45.
"Sales and new orders both weakened significantly to 50 from strong levels of 66 and 63 respectively in March 2012," Sacci said.
In April 2011 the sales volume index was at 46 and the new orders index stood at 45.
"The inventories index declined notably to 47 from 59 in March 2012 following strong inventory build-ups in both February and March 2012," said Sacci.
Supplier deliveries decreased by nine index points. The fewer trading days in April had played a significant role in weaker trade activity in April 2012 compared to March, the chamber explained.
Indices for sales and input prices remained virtually unchanged, at 63 and 72 respectively, and confirmed that price pressures remained high.
The increase in administered prices by more than 11 percent (on average) was worrying, it said.
"Looming demands for increases in the wage rate that are much higher than the inflation rate are cause for concern," said Sacci.
Trade expectations kept to the high levels recorded since the beginning of the year. For April, the trade expectations index (TEI) was at 64, only three points lower than in March 2012, but two points higher than in January 2012.
Sacci said the accommodating financial environment remained conducive to a positive trade outlook. According to the latest figures, credit extended to businesses increased by nearly 12 percent year-on-year in March 2012.
The six-month outlook for key components of trade activity contracted in April 2012, and sales and input price expectations remained high at 68 and 75, compared to 69 and 75 respectively in March 2012.
"Expected inventories and supplier deliveries fell but remained in positive territory."
Employment conditions in the trade environment dipped markedly during April 2012 as the index moved back into negative territory from 53 to 43. But Sacci said expectations on employment conditions remained positive at 55, up from 54 in March 2012 and 52 in April 2011.
