South Africa’s private sector slows to 20-month low in December
IHS Markit’s Standard Bank Purchasing Managers’ Index (PMI) dropped to 48.4 in December of last year.
In November of 2017, South Africa’s reading was 48.8, still remaining below the 50 mark that separates expansion from contract for the consecutive fifth month.
December’s PMI reading, however, was the lowest since April 2016, 20 months prior.
It is anticipated that the fall in reading was due to lack of demand, and this output subsequently led to companies cutting workforce, purchasing activity, and inventories.
According to Statistics South Africa, the nation dropped 83,000 formal jobs between September 2016 and September 2017.
The finding from Statistics South Africa also suggested that minimal business activity led to the decline in business activity.
The data also highlighted that contractions in output were connected to fall in client demand and difficult market conditions.