SA expected business conditions surge to two-year high

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The gauge rose to 68.1 in June from 57.6 a month earlier, Absa Group said on Monday.

An index tracking expected business conditions in six months’ time for the South African manufacturing industry jumped to the highest level since February 2022, on easing political uncertainty and expectations of improving demand. After more than a month of uncertainty over who would be in a coalition government formed by the African National Congress after it lost its parliamentary majority in May 29 elections, President Cyril Ramaphosa on Sunday announced a new cabinet.

He allocated ministerial posts to business-friendly opposition politicians while retaining close ally Enoch Godongwana as finance minister and signaling his intent to revive sluggish economic growth. The higher reading was also due to hope that domestic and global demand, which has been weak and kept the purchasing managers’ index in contractionary territory for a second straight month, may improve amid expectations of lower interest rates, the lender said.

 

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