South African trade condition recovers

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Trade conditions recovered in October from a setback in August and September 2013, the South African Chamber of Commerce and Industry (SACCI) said on 13 November 2013.

“Trade conditions recovered from the setback suffered in August and September 2013, with the Trade Activity Index (TAI) measuring 58 in October 2013 or 55 if seasonally adjusted,” said the Chamber.

The TAI improved by five points (seasonally adjusted) from September 2013 and it is at a better level than in October 2011, where it was at 48 and October 2012 where it was at 50.

“The deterioration in August and September and the recovery in October 2013 are typical of the volatility experienced in trade conditions during the year,” noted the chamber.

The sales volumes and new orders indices improved strongly on the September figures, while inventories declined in October. The sales and input prices rose faster in October 2013, with input price increases being experienced by 75% of the respondents.

SACCI said that with more price pressures, inflationary expectations are likely to rise, with the price expectations indices on sales and inputs, however, eased somewhat at levels of 67 and 74 respectively.

The seasonally adjusted trade expectations index (TEI) remained in positive territory at 59 in October 2013. The outlook for sales volumes (-2 index points), new orders (-1 index point), and supplies (-2 index points) points toward stickier trade conditions within the next six months.

Meanwhile employment conditions in the trade sector remained in positive territory at 53 compared to 54 for the index in September 2013.

“Employment prospects slipped as the index weakened marginally from 52 to 51 in October 2013. The trade environment was less exposed to strikes than other sectors in 2013 although the disruption of trading by labour unrest negatively affected overall trade conditions,” said SACCI.

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