04 Jul.
Absa: SA Morning Sheet.
This is a daily economic comment …
The sheets can be downloaded daily from Absa Economic Research
An extract fro today’s sheet is provided as an example:
South Africa’s seasonally adjusted PMI slowed for the third consecutive month to 53.9 in June from 55.1 in May. The June print marks the lowest level in the index this year.
Underpinning the moderation in the headline index were lower readings in both the current activity and more forward looking sub-indices, with the business activity sub-index slowing to 55.2 (56.8 previously) and the new sales orders sub-component to 58 (61 previously). The PMI employment index also continued to deteriorate in June, slipping to 47.7 from 48.7 the prior month. This marks the fourth consecutive month the index has been below the neutral level of 50 after it moved briefly into positive territory in February.
Encouraging, however, was the fact that the inventories subcomponent bounced back after May’s slowdown, to 58.8 (prior: 54.5) reflecting, in our view, local manufacturers’ slowly rising levels of confidence that the business environment is improving domestically. Another more positive aspect from Friday’s release was the fact that the PMI price index slowed for the third consecutive month, to 76 from 80 the prior month, perhaps also revealing some respite in the upward pressure on prices at the manufacturing level. For the quarter as a whole, the headline PMI measured an average of 55.1 down from the 55.5 average in the preceding quarter.
This fits with our view that some level of moderation in the pace of growth in the manufacturing sector was likely in Q2 after the sector was the largest single contributor to Q1 GDP growth. Critically however, is the fact that the index remains above the neutral level of 50 and, along with some positive indications in the likes of inventories being rebuilt, suggests that the sector should be able to maintain a positive (albeit more modest) growth trajectory over the rest of 2011.
It is another relatively quiet week for economic data, with only a few small releases scheduled. Today sees the release of new vehicle sales figures for June. …
The sheets can be downloaded daily from Absa Economic Research
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