FX.co ★ South Africa Private Sector Downturn Deepens

The S&P Global South Africa PMI decreased to 48.3 in March 2025, down from 49.0 in February. This represents the fourth consecutive month of contraction as continuing weak demand led to further reductions in output and new orders. The economic and political uncertainties continued to exert pressure on spending. Notably, new business saw its second-largest decline within a year. However, export orders experienced a rise for the first time in seven months, driven by increased demand from other African countries. In addition, the workforce was reduced for the third straight month, although the decrease in jobs was minimal. Both purchasing activity and inventory levels also saw a downturn. Regarding pricing, input price inflation dropped to its lowest in five months, bolstered by a stronger rand and a deceleration in service-sector cost increases. This reduction enabled firms to lower their selling prices for the first time since October 2024. Looking forward, while business confidence slightly declined, it remains in line with long-term trends. Companies continue to be cautious but are hopeful for a boost in demand, lower inflation, and heightened investment activities.