SA manufacturing index climbs to 2025 high, but recovery remains fragile

SOUTH Africa's manufacturing sector showed renewed momentum in September, with the Absa Purchasing Managers' Index (PMI) rising by 2.7 points to 52.2, its strongest level since October 2024.

- YOGASHEN PILLAY

THERE has been a welcome reaction as the Absa Purchasing Managers' Index (PMI) released on Wednesday increased by 2.7 points to 52.2 points in September 2025 its highest reading this year. PIXABAY

The PMI, compiled by Absa, the Bureau for Economic Research (BER) and Stellenbosch University, indicates that the sector returned to expansionary territory, supported by stronger domestic demand.

Encouragingly, the average PMI for the third quarter improved to 50.8 points, up from 45.4 in the second quarter and 46.2 in the first quarter.

However, economists at Absa Corporate and Investment Banking cautioned that the recovery has been volatile, with sluggish global trade, steep US tariffs, and lingering port delays weighing on sustained activity.

“Manufacturers have been cautious when making employment decisions, due to extended periods of subdued demand not sufficient to lift production along with rising labour costs,” Absa said.

“The purchasing price index increased by 3.3 points, edging up to 61.7 in September, despite the fall in fuel prices at the start of the month and stability in the exchange rate.”