SA Purchasing Managers Index sharply lower

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By Mokgatla Madisha

The seasonally adjusted Investec PMI fell to 39.5 (from October’s 46.2) in November – the first reading ever to come in below 40 index points. Business conditions weakened significantly during the month and both the output and new sales orders indicators declined to record lows. Furthermore, inventory levels dropped notably and purchasing commitments were adjusted downwards.

The results, while sharply weaker, are in line with similar surveys across both developing and developed economies. Economic uncertainty has severely constrained purchasing managers’ near term business
expectations. The expected business conditions index nosedived almost 20 index points from 49.5 in October to 29.9 in November.

While managers seem positioned for further deterioration in business conditions, the sector may face continued headwinds over the medium term.


Source: Mokgatla Madisha, Investec Asset Management, December 1, 2008.


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