ABSA PMI shows local manufacturing sector back in growth mode
Andiswa Nondudule, Economist, ABSA CIB joins CNBC Africa for this discussion.
Tue, 01 Oct 2024 11:31:49 GMT
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AI Generated Summary
- The ABSA Purchasing Managers' Index (PMI) report indicates a significant increase in business activity and new sales orders in South Africa's manufacturing sector.
- While there is optimism surrounding the country's economy, the manufacturing sector has historically experienced volatility, posing a challenge for long-term predictions.
- Factors such as declining interest rates, stable power supply, and increased foreign direct investment are contributing to a positive outlook for the manufacturing industry.
South Africa's manufacturing sector is showing signs of positive growth according to the latest ABSA Purchasing Managers' Index (PMI) report. The index, which measures business activity and new sales orders, displayed a significant increase in September, surpassing the 50-point level. Andiswa Nondudule, an Economist at ABSA CIB, highlighted the key drivers behind this growth, attributing it to higher demand both domestically and internationally. However, she noted that despite the recent optimism in the economy, there has been a history of volatility in the manufacturing sector, making it challenging to predict the future trajectory with certainty. Despite this, there are several positive indicators pointing towards a sustained improvement in the sector. Factors such as declining interest rates, consistent power supply, and an uptick in foreign direct investment are contributing to the positive outlook for South Africa's manufacturing industry. Nondudule emphasized the importance of continued monitoring of key indicators to gauge the sector's stability and growth potential. The overall sentiment is one of cautious optimism, with expectations of sustained improvement in the manufacturing sector moving forward.
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