South Africa Private Sector Expands in March

The S&P Global South Africa PMI rose to 50.8 in March 2026 from 50 in February, signaling the first upturn in business conditions for six months. Output increased at the quickest rate in six months, accompanied by stronger job creation and a first rise in input inventories since last November. However, signs emerged that heightened economic uncertainty and supply chain disruptions linked to the war in the Middle East had begun to weigh. New orders fell for a second month, accelerating as export sales dropped at the fastest rate in over two years. Delivery times lengthened to a 16-month high due to sea freight disruptions via the Strait of Hormuz. On the price front, input price inflation surged amid rising fuel costs, a stronger US dollar, and minimum wage changes, leading to the biggest increase in output charges in more than a year. Expectations for future activity weakened further, reaching their lowest level since July 2021.

The S&P Global South Africa PMI was unchanged at 50 in February 2026, signaling stable private-sector business conditions for a second consecutive month after weakness in late 2025. Output was broadly unchanged, supported by firms clearing backlogs, while new orders declined slightly. The continued fall in outstanding work pointed to a weaker pipeline and a cautious near-term outlook. Employment rebounded with a modest rise in staffing, though inventories declined again amid restrained purchasing. Supplier delivery times worsened slightly but delays were less severe than earlier in the year. Input cost pressures remained subdued thanks to a stronger rand and lower fuel prices, even as wage inflation hit a seven-month high. Softer overall cost burdens enabled firms to lower selling prices for the first time since May 2025. Business confidence eased to its lowest level since July 2021, despite expectations that easing inflation and potential rate cuts could support growth.

The S&P Global South Africa PMI rose to 50.0 in January 2026 from 47.7 in December, signaling a stabilization in private-sector business conditions after a weak fourth quarter. Output and new orders were broadly unchanged, as modest improvements in domestic demand were offset by continued weakness in services and falling export orders. Purchasing activity increased slightly on firmer demand momentum, while inventories declined as supplier delivery times lengthened for the first time in ten months due to port delays and weaker supplier performance. Backlogs continued to fall, and employment edged lower as firms reduced staff or paused hiring. On prices, input cost inflation slowed to a three-month low, allowing selling price increases to soften to their weakest pace since October. Despite challenges, business confidence stayed relatively upbeat, supported by expectations of stronger demand, improved energy supply, rising tourism, and better domestic economic conditions.