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Though manufacturing output rose by less than the market expected in January, indicators show the outlook for the sector remains positive. The Kagiso Purchasing Managers’ Index – based on a survey of buyers – suggests the sector will continue to expand at a reasonably high level. The Bureau for Economic Research’s manufacturing survey showed a sharp increase in confidence levels in the industry.
OUTPUT DISAPPOINTS Manufacturing output in January rose by 1,3% year-on-year – better than the paltry 0,2% growth recorded in December 2010 but well below market expectations of a 2,2% annual rise. The month-on-month increase, which will feed into first quarter gross domestic product figures, rose by a seasonally adjusted 0,4%. Nedbank noted the figures suggest the pace of recovery in production remained modest relative to consumer spending.
PMI STABILISES The seasonally adjusted Kagiso Purchasing Managers’ index (PMI) stabilised at a reasonably high level in February, reaching 54,8 points. A level above 50 indicates expansion in the sector. Theo Vorster, consultant at Kagiso Trust Investments, says the most heartening trend in the latest numbers was that the PMI employment index rose back above the key 50 mark.
SURVEY SHOWS IMPROVEMENT The Bureau for Economic Research (BER) compiles confidence indices for different sectors based on surveys with business people. The BER’s latest manufacturing survey indicates manufacturing business confidence increased by 10 index points to 51 over first quarter 2011. Demand conditions continued to improve, with the strength surprising manufacturers. Production improved over the quarter.
BUSINESS CONFIDENCE UP Helped by a surge in manufacturing business confidence, the overall Rand Merchant Bank/Bureau for Economic Research business confidence index jumped from 44 points in fourth quarter 2010 to 55 in first quarter 2011. An index number above 50 means there are now more companies optimistic than pessimistic about business conditions.
OUTPUT DISAPPOINTS Manufacturing output in January rose by 1,3% year-on-year – better than the paltry 0,2% growth recorded in December 2010 but well below market expectations of a 2,2% annual rise. The month-on-month increase, which will feed into first quarter gross domestic product figures, rose by a seasonally adjusted 0,4%. Nedbank noted the figures suggest the pace of recovery in production remained modest relative to consumer spending.
PMI STABILISES The seasonally adjusted Kagiso Purchasing Managers’ index (PMI) stabilised at a reasonably high level in February, reaching 54,8 points. A level above 50 indicates expansion in the sector. Theo Vorster, consultant at Kagiso Trust Investments, says the most heartening trend in the latest numbers was that the PMI employment index rose back above the key 50 mark.
SURVEY SHOWS IMPROVEMENT The Bureau for Economic Research (BER) compiles confidence indices for different sectors based on surveys with business people. The BER’s latest manufacturing survey indicates manufacturing business confidence increased by 10 index points to 51 over first quarter 2011. Demand conditions continued to improve, with the strength surprising manufacturers. Production improved over the quarter.
BUSINESS CONFIDENCE UP Helped by a surge in manufacturing business confidence, the overall Rand Merchant Bank/Bureau for Economic Research business confidence index jumped from 44 points in fourth quarter 2010 to 55 in first quarter 2011. An index number above 50 means there are now more companies optimistic than pessimistic about business conditions.
