Fin24

Kagiso PMI falls in October

2012-11-01 13:10

Johannesburg - The seasonally adjusted Purchasing Managers' Index (PMI) by Kagiso Tiso Holdings fell to 47.1 in October from a revised 48.3 (46.2) in September.

The revisions were due to new seasonal adjustment factors that are revised once a year. The unadjusted PMI rose to 51.2 in October from 51.0 in September.

The PMI is a key leading indicator for activity in the manufacturing sector and is conducted on a monthly basis by the Bureau for Economic Research (BER) and the Chartered Institute of Purchasing and Supply.

An index level of below 50 represents contraction in the manufacturing sector‚ while a reading of more than 50 signifies expansion.

The Japanese PMI fell to 46.9 in October from 48.0 in September‚ while the HSBC PMI for China rose to 49.5 from 47.9. The India PMI edged up to 52.9 in October from 52.8 in September and the Russian PMI rose to 52.9 from 51.0. The Australian PMI moved up to 45.2 from 44.1 in September and the Turkish PMI increased to 52.5 from 52.2.

Andre Coetzee‚ MD of the Chartered Institute of Purchasing and Supply said that the prolonged strikes in the mining sector through October and isolated industrial action in the vehicle manufacturing sector may have contributed to the weakness in the SA PMI during the month.

The SA business activity dropped to 43.2 in October from 46.2 in September‚ while the new orders index fell to 45.3 from 48.3.

The employment index rose to 49.2 in October from 47.9 and remained below August’s 50.7.

The prices index rose to 77.1 in October from 75.8 in September and 70.9 in August. The expected business conditions index rose to 57.1 in October from 55.5 in September and 52.9 in August.

“Of interest is that‚ for the second month in a row‚ purchasing managers were more optimistic about the future‚” Coetzee said.