Investec Purchasing Managers Index contracts sharply

 EmailPrint This Post Print This Post

By Andre Roux

The seasonally adjusted Investec PMI sunk to 46.4 in February, well below the critical level of 50. In all likelihood, the decline reflects not only the effect of a softening real economy, but also the impact of the electricity crisis on the sector.

Both output and new sales orders contracted during the month and the tight conditions were aggravated by a significant increase in input price inflation. The seasonally adjusted employment index plunged to 44.1, after coming in above the critical level of 50 index points for 20 consecutive months. This may mark the beginning of cutbacks in employment in response to the deterioration in business conditions.

The results indicate that the manufacturing sector is taking strain. Purchasing managers expect conditions to improve somewhat in the next few months. However, their expectations with respect to conditions in 6 months’ time were adjusted downwards to the lowest level since 1999.

investec-3-mrt-1.jpg

Source: Andre Roux, Investec Asset Management, March 2008.

Did you enjoy this posting? If so, click here to subscribe to updates to Investment Postcards from Cape Town by e-mail.

OverSeas Radio Network

Leave a Reply

  

  

  

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Top 100 Financial Blogs

Recent Posts

Charts & Indexes

Gold Price (US$)

Don Coxe’s Weekly Webcast

Podcast – Dow Jones


One minute - every hour - weekdays
(requires Windows Media Player)
newsflashr network
National Debt Clock

Calendar of Posts

March 2008
MTWTFSS
« Feb Apr »
 12
3456789
10111213141516
17181920212223
24252627282930
31 

Feed the Bull