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South Africa factory activity expands at slower rate in December - Absa PMI

01/07/2022 | 04:11am EDT
Woman works at clothing factory at the industrial town of Newcastle

JOHANNESBURG (Reuters) - South African manufacturing activity expanded at a slower rate in December as new sales orders and employment edged lower, a survey showed on Friday.

The seasonally-adjusted Absa Purchasing Managers' Index (PMI) fell to 54.1 points in December from 57.2 points in November, remaining above the 50-point mark that separates expansion from contraction.

Absa said in a statement accompanying the survey's findings that a drop in exports impacted sales orders in December.

"While it is not clear what drove the notable export easing, slower services sector activity in the Eurozone amid a surge in COVID-19 infections and an associated tightening in lockdown restriction in several countries at the end of 2021 may have contributed," Absa said.

The employment index dropped to 42.4 in December from 50.6 in November.

"Although we would caution not to read too much into a single month's print, the employment dynamics need to be watched," Absa said. "The weakness in the employment indicator could be seen against the backdrop of reduced optimism about future business conditions."

The South African economy has long suffered from high levels of joblessness, contributing to poverty and inequality that persist nearly three decades after the end of white minority rule.

The unemployment rate hit a new record high of 34.9% in the third quarter of 2021.

(Reporting by Olivia Kumwenda-Mtambo; Editing by Promit Mukherjee)


ę Reuters 2022
Stocks mentioned in the article
ChangeLast1st jan.
ABSA GROUP LIMITED 0.79% 168.79 End-of-day quote.10.65%
DOW JONES AFRICA TITANS 50 INDEX 0.59% 504.49 Real-time Quote.-7.16%
DOW JONES SOUTH AFRICA(ZAR) 0.55% 1958.82 Real-time Quote.-1.85%
S&P AFRICA 40 INDEX 0.69% 161.44 Real-time Quote.-9.14%
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