South Africa’s purchasing managers’ index rose to the highest in two years in February, a signal the manufacturing industries in Africa’s biggest economy are rebounding from last year’s slump, Kagiso Tiso Holdings said.
The seasonally adjusted index rose to 57.9 from 53.2 in January, Johannesburg-based Kagiso, the financial services company that compiles the index, said in an e-mailed statement today. The median estimate of 3 economists surveyed by Bloomberg was 52.3. A number above 50 indicates an expansion in factory output.
“We have seen a pick-up in manufacturing volumes in steel and petroleum products and these could have contributed to the robust showing in activity levels and new sales orders,” said Abdul Davids, head of research at Kagiso Asset Management.
Manufacturing and mining expanded in the last three months of 2011 after contracting in the second and third quarters, lifting economic growth from close to a two-year low. The Reserve Bank has kept its benchmark interest rate at a more than 30-year low of 5.5 percent since November 2010 as it seeks to cushion the economy from a slowdown in Europe. The economy grew at an annualized 3.2 percent in the fourth quarter
The index measuring new sales orders increased 7.5 points to 64.8 last month and the business activity sub-index rose 11.6 points to 65.2, Kagiso said. The price sub-index fell 5.7 to 75.7, dropping below 80 for the first time since September.
Inflation accelerated to 6.3 percent in January, the third month it has exceeded the central bank’s 3 percent to 6 percent target.
The Bureau for Economic Research, based at the University of Stellenbosch near Cape Town, and the Institute of Purchasing and Supply South Africa conduct the PMI survey on behalf of Kagiso.