Absa and IHS Markit indicators will provide a clearer snapshot of the effect of the coronavirus pandemic
The crippling effect of the national lockdown on economic activity should continue to be evident in data released this week despite the slight easing of lockdown restrictions from May 1.
IHS Markit economist David Owen said the collapse in economic activity was likely “even more cataclysmic” than the index suggested as the lengthening of supplier delivery times, normally a sign of a busy market, artificially boosted the reading. BNP Paribas economist Jeff Schultz expects a modest improvement in the Absa Manufacturing PMI to 46.5 in May given that lockdown measures were loosened from May 1. However, as supplier delivery times could tighten with the gradual reopening of the economy, SA’s PMIs could fall substantially again from June, he warns.New-vehicle sales data for May will be released by the National Automobile Manufacturers of SA on Monday, and on Thursday, Stats SA will update electricity production for April.
Schultz expects new-vehicle sales growth to have remained deep in contractionary territory in May as growing economic uncertainty, loss of job security and weak activity levels continue to weigh on durable-goods purchases.
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