Manufacturing confidence touches 11-year high

ED RICHARDSON
THE IMPORTANCE of a weaker rand to support manufacturing in South Africa is highlighted in the latest manufacturing survey by the Bureau for Economic Research (BER). While the fourth quarter survey of manufacturing business confidence was at an 11-year high (75 points), the BER says it has not surpassed the previous peak of 78 index points measured in the final quarter of 1995. “Although manufacturing conditions are rather buoyant, one has to keep in mind that the more favourable level of the rand exchange rate during the survey period may have played an important role. “Since then the rand has come back somewhat and the effect thereof was evident in the November Investec PMI results. Furthermore, manufacturing business confidence is still well below that of other sectors implying that there is still room for improvement, in which the future path of the rand exchange rate will play a pivotal role,” says BER economist Christelle Swanepoel.