Manufacturing contracts for the third straight month in August

News24
10 Oct 2019, 19:13 GMT+10

South African factory output shrank for a third straight month in August.

Manufacturing production declined 1.8% from a year earlier, compared with a revised 0.7% drop in July, Pretoria-based Statistics South Africa said on Thursday in a report on its website.

The median estimate of 11 economists in a Bloomberg survey was for a 2.5% contraction. Output increased 1.3% in the month.

Key insights

Manufacturing accounts for about 14% of gross domestic product, and output is very sensitive to power-supply constraints. While Eskom hasn't implemented large-scale blackouts since the first quarter, a member of the utility's board, Nelisiwe Magubane, has warned that an uptick in economic growth could lead to a new round of power cuts as Eskom won't be able to respond to an increase in demand for electricity.

The drop in output exacerbates a poor start to the third quarter for an economy that managed to dodge a second recession in consecutive years after it expanded an annualised 3.1% in the three months through June.

The largest declines were in the iron and steel, non-ferrous metal products and machinery sectors.

A gauge measuring sentiment in South Africa's manufacturing industry fell to the lowest level in more than a decade in September. It will probably get worse after the measure tracking expected business conditions in six months' time declined for a fourth month, according to Absa's Purchasing Managers' Index.

South Africa's economy is stuck in its longest downward cycle since 1945, with business confidence at the lowest level in more than three decades.

Watch latest videos

News RELEASES

Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Professional Autos.

More Information

null in null

Business

Section

Engine defect prompts Nissan to recall over 443,000 vehicles

FRANKLIN, Tennessee: Hundreds of thousands of Nissan and Infiniti vehicles are being recalled across the United States due to a potential...

Microsoft trims jobs to manage soaring AI infrastructure costs

REDMOND, Washington: Microsoft is the latest tech giant to announce significant job cuts, as the financial strain of building next-generation...

Stocks worldwide struggle to make ground Friday with Wall Street closed

LONDON UK - U.S. stock markets were closed on Friday for Independence Day. Global Forex Markets Wrap Up Friday with Greeback Comeback...

Nvidia briefly tops Apple’s record in AI-fueled stock rally

SANTA CLARA, California: Nvidia came within a whisker of making financial history on July 3, briefly surpassing Apple's all-time market...

ICE raids leave crops rotting in California, farmers fear collapse

SACRAMENTO, California: California's multibillion-dollar farms are facing a growing crisis—not from drought or pests, but from a sudden...

Trump signals progress on India Trade, criticizes Japan stance

WASHINGTON, D.C.: President Donald Trump says the United States could soon reach a trade deal with India. He believes this deal would...

Engineering

Section

"Wanted to revive AJL, no rent enjoyed by Young Indian": Rahul Gandhi's counsel tells Delhi court in National Herald case

New Delhi [India], July 5 (ANI): Young Indian was created to revive Associated Journal Limited (AJL) and not to earn rent, Congress...