{"id":859090,"date":"2026-05-04T12:00:00","date_gmt":"2026-05-04T10:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=859090"},"modified":"2026-05-04T11:46:32","modified_gmt":"2026-05-04T09:46:32","slug":"best-news-in-8-months-for-one-of-south-africas-most-important-sectors","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business-opinion\/859090\/best-news-in-8-months-for-one-of-south-africas-most-important-sectors\/","title":{"rendered":"Best news in 8 months for one of South Africa’s most important sectors"},"content":{"rendered":"\n

The seasonally adjusted Absa Purchasing Managers\u2019 Index (PMI) has risen into positive territory, but there are warnings that the improvement may not be sustainable. <\/p>\n\n\n\n

The Absa PMI is an indicator of the health of the manufacturing sector, one of the nation’s largest employers, and is compiled by the Bureau for Economic Research (BER). <\/p>\n\n\n\n

The PMI rose above the neutral 50-point mark for the first time since September 2025, increasing to 52.6 in April from 49 in March. This was ahead of Investec’s prediction of a contraction to 47.8. <\/p>\n\n\n\n

The Q2 improvement was driven by a rebound in both business activity and new sales orders, which pointed to a stronger start to the second quarter following a weak first quarter. <\/p>\n\n\n\n

That said, some of the improvement likely reflects front-loading of demand ahead of expected price increases, raising questions about the sustainability of the recovery.<\/p>\n\n\n\n

The business activity index rose for the second straight month, returning to expansionary territory. <\/p>\n\n\n\n

This suggested that production picked up meaningfully at the start of Q2 following a subdued first quarter for 2026. <\/p>\n\n\n\n

The increase also appeared to be driven by stronger domestic demand, while export sales declined. The divergence suggests the recovery is not broad-based and remains vulnerable to external headwinds.<\/p>\n\n\n\n

Some respondents also indicated that orders could have been brought forward in anticipation of further cost increases, which could result in weaker demand in the months ahead. <\/p>\n\n\n\n

The inventories index increased and moved above the neutral 50-point mark for the first time since August 2025. <\/p>\n\n\n\n

“This likely reflects stock-building behaviour, with firms purchasing inputs ahead of expected price
increases,” said the report. <\/p>\n\n\n\n

“While this supported the headline PMI in April, it may also point to temporary factors rather than a
sustained increase in underlying demand.” <\/p>\n\n\n\n

Cost pressures grow <\/h2>\n\n\n
\n
\"\"<\/a><\/figure><\/div>\n\n\n

Absa noted that cost pressures continued to rise in April, with the purchasing price index rising to 85.6 following the record increase in March.<\/p>\n\n\n\n

The index is now over 30 points above its level at the start of the year, reflecting higher oil-linked input costs and a slightly weaker exchange rate.<\/p>\n\n\n\n

Absa said that input costs are likely to squeeze profit margins and could limit the sustainability of the April improvement in activity. <\/p>\n\n\n\n

Moreover, greater cost pressures at the factory level could contribute to larger inflationary pressures in the economy.<\/p>\n\n\n\n

The index tracking expected business conditions improved slightly in April, even if it remains below the neutral 50-point mark. <\/p>\n\n\n\n

“This suggests that while purchasing managers are somewhat less pessimistic than in March, confidence in the outlook remains subdued.” <\/p>\n\n\n\n

“Most responses were in before the fuel levy relief extension was announced, which does soften the direct hit from the diesel price increase a little.” <\/p>\n\n\n\n

    \n
  1. <\/li>\n<\/ol>\n\n\n\n
    Sub-Index<\/strong><\/td>February<\/strong><\/td>March<\/strong><\/td>April<\/strong><\/td><\/tr>
    Business Activity<\/td>45.7<\/td>46.1<\/td>52.8<\/mark><\/td><\/tr>
    New Sales Orders<\/td>45.2<\/td>44.5<\/td>52.9<\/mark><\/td><\/tr>
    Employment<\/td>42.5<\/td>43.3<\/td>43.8<\/mark><\/td><\/tr>
    Inventories<\/td>48.1<\/td>48.8<\/td>52.3<\/mark><\/td><\/tr>
    Supplier Deliveries*<\/td>55.3<\/td>62.1<\/td>61.4<\/mark><\/td><\/tr>
    Purchasing Prices*<\/td>55.1<\/td>75.8<\/td>85.6<\/mark><\/td><\/tr><\/tbody><\/table><\/div>
    *Inverted<\/figcaption><\/figure>\n\n\n
    \n
    \"\"<\/a><\/figure><\/div>\n\n\n
    \n","protected":false},"excerpt":{"rendered":"

    The latest Absa PMI shows that sentiment in the manufacturing sector was in positive territory for the first time since September 2025.<\/p>\n","protected":false},"author":95,"featured_media":856685,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[29],"class_list":["post-859090","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-opinion","tag-absa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/859090","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=859090"}],"version-history":[{"count":4,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/859090\/revisions"}],"predecessor-version":[{"id":859105,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/859090\/revisions\/859105"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/856685"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=859090"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=859090"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=859090"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}