The year kicks off with two Stats SA releases on Thursday, one on manufacturing production and sales for November and the other on the residential property price index report for August.
It will be interesting to see whether manufacturing production continues to improve after the 0.8% year-on-year increase in October, which reversed the 0.8% drop recorded for September.
Confidence in the manufacturing sector has strengthened, as demonstrated by a manufacturing confidence index which provides an indication of future business developments in the manufacturing sector. It is based on opinion surveys about production, orders and finished goods stocks.
According to Trading Economics, the RMB/BER business confidence index rose to 45 points in the fourth quarter of 2024, up from 38 in the previous three-month period.
“This was the third consecutive increase in business sentiment, which now puts the index at its highest since quarter-one 2022. Encouragingly, the rise in sentiment was driven by improved activity and better business conditions, supported by a stable electricity supply and political stability.
“All subsectors, except new vehicles, saw increases. The building contractors’ sector surged by 10 points to 51 in the fourth quarter, while wholesale trade rose to 60 from 51. Manufacturing climbed to 36 from 28, and retail sector confidence improved to 54 from 45,” the research entity said.
Manufacturing is key to economic growth, generating billions of rand in export revenue, accounts for about 13% of GDP and creates a significant number of direct and indirect jobs.
Stats SA said that in October manufacturing output was bolstered mainly by the petroleum, chemical products, rubber and plastic products sector, which was the largest growth contributor for a third consecutive month, rising 4.5% and contributing 0.9 of a percentage point.
The food and beverages sector rose 2.9% and contributed 0.7 of a percentage point to the outcome. Basic iron and steel, nonferrous metal products, metal products and machinery also marked an increase, reporting a 2.7% rise to contribute 0.6 of a percentage point after a 5.4% decline in August. Seasonally adjusted, the division rose 3.6% in September.
Production in the automotive sector continued to decline in October, with the motor vehicles, parts and accessories, as well as other transport equipment divisions, falling 16.6% after the 18% decline in the previous month.
Seasonally adjusted manufacturing sales increased 2.3% in October month on month, compared with September’s 1.1% fall and a 2.6% decline in August, Stats SA said.
The residential property price index measures the change in prices for all dwellings, including houses, town houses, and flats purchased by private individuals. The data for the index is sourced from property transactions housed in the deeds office.
Annual residential property price inflation was 2.9% year on year in July, up slightly from 2.8% in June.
According to Trading Economics, residential property prices averaged 4.47% from 2017 to 2024, reaching a record high of 7.5% in January 2018 and a record low of 1.6% in May 2023.
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