JOHANNESBURG, June 1 (Reuters) – South Africa’s factory sentiment eased in May as activity and demand slowed, though it remained in expansionary territory for a second consecutive month, a purchasing managers’ index (PMI) survey showed on Monday.
• The seasonally adjusted PMI sponsored by South African bank Absa fell to 50.8 from 52.6 in April.
• A reading above 50 indicates expansion in business activity.
• “In April, manufacturers benefitted from demand being brought forward in anticipation of further cost increases, but this effect faded in May,” said Absa in a statement.
• It added that both activity and demand softened, while input costs which have been pushed higher by a weaker rand and higher international oil prices continued to pose challenges for manufacturers.
• Production slipped back into contraction, with the business activity index falling to 43.5 from 52.8. New sales orders also retreated to 44.6 from 52.9.
• “Some respondents warned that the recent weakness in demand could persist in the coming months,” said Absa.
• An index tracking expected business conditions in six months rose above the 50 threshold to 52.9 from 47.4.
(Reporting by Sfundo Parakozov;Editing by Olivia Kumwenda-Mtambo)
