South Africa’s Private-Sector Activity Barely Improved In July – PMI

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Activity in South Africa‘s private sector was barely improved in July with business conditions overall remaining subdued despite an uptick in inventories and employment, a survey on Thursday showed.

South Africa‘s Standard Bank Purchasing Managers’ Index (PMI) rose to 50.1 in July from 49.0 in June, inching just above the 50 mark that separates growth from contraction.

The reading is the second-lowest in the past 11 months and below the six-year survey average of 50.7. It was however higher than the 2016 average of 49.7.

“This means that private sector prospects are slightly better now than last year and could even improve more

meaningfully should domestic policy execution become positive and entrenched,” said Standard Bank analyst Thanda SitholeSouth Africa‘s economy entered a technical recession in March although the central bankgovernor has said it should return to growth in the second quarter.

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Long-running political uncertainties have meanwhile intensified since June, when local media began reporting on more than 100,000 leaked emails they say show inappropriate interference by the wealthy Gupta family and ministers in the issuing of lucrative government tenders. The Guptas and their friend President Jacob Zuma have denied any wrongdoing.

The political instability, together with record-high unemployment and the risk of credit ratings downgrades deeper into “junk” territory, has put severe strain on business and consumer confidence in South Africa.

Read full story: ENGINEERING NEWS


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