BusinessSouth African enterprise exercise fell in Oct after strike...

South African enterprise exercise fell in Oct after strike -PMI

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JOHANNESBURG, Nov 4 (Reuters)South Africa’s non-public sector exercise contracted in October after a strike by its greatest metal-workers union led to a marked slowdown in enterprise exercise amid ongoing uncooked materials shortages, a survey confirmed on Thursday.

IHS Markit’s Buying Supervisor’s Index (PMI) fell to 48.6 in October from 50.7 a month earlier than. In September the PMI was above the 50 level mark that separates growth from contraction for the primary time since June.

“The strike by the Nationwide Union of Metalworkers throughout October led to a marked drop in enterprise exercise,” stated David Owen, economist at IHS Markit.

NUMSA, which has round 155,000 members within the sector, launched the strike early final month to press for larger salaries.

“Output fell in all monitored sectors, though the decline was most extreme in manufacturing. Shortages of uncooked supplies have been broadly reported once more, with metal, chemical substances and electrical parts the most definitely to be briefly provide,” Owen stated.

Owen added that companies affected by the strikes have been usually unable to satisfy demand, resulting in a strong fall in general gross sales and an extra enhance in backlogs.

Shortages of uncooked supplies have been additionally highlighted by companies, contributing once more to weaker exercise, longer lead instances and an acceleration of enter worth inflation.

That’s prone to impression third quarter financial information though there may very well be a swift restoration in November and December given the strikes have now ended, serving to South Africa to keep away from a recession.

(Reporting by Vuyani Ndaba; Modifying by Toby Chopra)

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The views and opinions expressed herein are the views and opinions of the creator and don’t essentially replicate these of Nasdaq, Inc.



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