The Absa Purchasing Managers’ Index (PMI) for February 2025 highlights continued challenges for South Africa’s manufacturing sector.
The seasonally-adjusted Absa PMI declined slightly by 0.6 points to 44.7 in February, remaining in contractionary territory for the fourth consecutive month.
This reflects subdued activity in the manufacturing sector, which has yet to recover following its weak performance at the end of 2024.
Key highlights from the February 2025 PMI include:
- Decline in Business Activity: The business activity index dropped by 2.9 points to 40.6, reflecting weaker demand and ongoing material supply challenges.
- New Sales Orders Continue to Fall: The new sales orders index declined to 38.7 points from 42 in January, as export sales slumped due to global trade tensions, logistical issues, and lower-than-expected demand.
- Supplier Deliveries Slow Down: The supplier deliveries index rose by 5.1 points to 55, indicating slower delivery times. While the index has been volatile in recent months, the uptick suggests that supply chains remain constrained.
- Employment Index Still in Contraction: The employment index decreased by 2.3 points to 42.2, marking eleven consecutive months of contraction in the sector.
- Cost Pressures Mount: The purchasing price index increased by 2.2 points to 70.4, reflecting a weaker rand and rising input costs, including higher Brent crude oil prices and fuel costs.
- Business Confidence Weakens: The index tracking expected business conditions in six months’ time declined by 4.4 points to 60.5, as uncertainties around global trade, South African-US relations, and the return of load-shedding weighed on sentiment.
- The February PMI results highlight persistent pressures on South Africa’s manufacturing sector, with weak demand, supply chain disruptions, and rising costs adding to the strain.