09 Jan.
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:
It is a slightly busier week on the South African data calendar, kicking off with the release of the SA Reserve Bank’s gold and foreign exchange reserve position this morning (8:00am SA time). A weaker EUR during December together with the gold price falling almost 10% during the month means December gross reserves are likely to have declined – consensus expects a drop of about ZAR900mn , to ZAR48.8bn).
Manufacturing production growth figures on Thursday however are likely to generate the largest amount of attention. While the Bloomberg consensus estimates expects growth in manufacturing production to pick up slightly in November (1.3% y/y versus 1.0% y/y previously), we remain cautious on the outlook for the sector. Underpinning our more cautious outlook for these figures is our observation of a drop in the PMI’s leading indicator – new sales orders divided by inventories – in November. This ratio dropped to 0.94 (from 1.0 in October). Another negative for the manufacturing sector in coming months was deterioration in the PMI’s expected business conditions subindex, which fell to 55 from 62.4 previously given uncertainties associated with Europe and the possible contagion effect on global demand for manufactured goods.
There are however some positives for the upcoming November print that are worth mentioning. Exports of manufactured goods such as chemicals and machinery performed relatively well, while exports of vehicles grew by an impressive 37% m/m. That said, lags do exist, and as a result, not all exports are necessarily produced in the same month in which they were exported. Another positive was the headline PMI, which edged higher to 51.6 in November from 50.5 in October (the December PMI will be released on 18 January). …
The sheets can be downloaded daily from Absa Economic Research
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