JOHANNESBURG, July 2(Reuters) – South Africa’s seasonally
adjusted Purchasing Managers’ Index fell to 48.2 in June from
53.6 in May, dropping into contraction territory for the first
time since December and dampening the outlook for overall
economic growth in the second quarter.
The PMI, a key measure of manufacturing activity, was at its
lowest level since August 2011, with most of the sub-indices
recording significant declines, sponsor Kagiso Tiso Holdings
said in a statement on Monday.
“In addition to weaker external demand, the latest figures
indicate a sustained and worsening slowdown in domestic demand
as the New Sales Orders Index, the largest weighted sub-index,
fell by 5.2 points to reach a level of 46.5,” said Abdul Davids,
Head of Research at Kagiso Asset Management.
The weak PMI suggests domestic growth slowed in the second
quarter of 2012 and backs the case for monetary loosening later
this year. Factory output contributes about 15 percent to gross
domestic product.
(Reporting by Stella Mapenzauswa; Editing by Xola Potelwa)
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