South African Private Sector Activity Increases in August

JOHANNESBURG (Reuters) – South African private sector activity rose in August as firms received higher volumes of new orders for the first time since April 2023, a survey showed on Wednesday.

The S&P Global South Africa Purchasing Managers’ Index rose to 50.5 in August from 49.3 in July, marking its first movement above the 50-point mark—which separates growth from contraction—in three months.

“South African businesses saw demand growth emerge in August, as customers increased their spending on the back of falling CPI inflation figures and a general optimism that economic conditions are stabilising,” said David Owen, senior economist at S&P Global Market Intelligence.

South Africa’s inflation decreased to 4.6% year-on-year in July, down from 5.1% in June, providing relief to consumers and cementing analysts’ expectations for an interest rate cut this month.

“The rise in new orders was the first recorded in over a year, offering hope that the recent malaise in the private sector is starting to fade,” Owen added.