February saw stronger trade conditions following a slow start in January, the South African Chamber of Commerce and Industry (SACCI) said on Wednesday.
“Trade conditions had a slow start in January 2012, but it put up a strong showing in February 2012,” said SACCI as it released its monthly Trade Conditions Survey.
According to SACCI, the non-seasonally adjusted Trade Activity Index (TAI) increased by 9 points to 57 points in February while the seasonally adjusted TAI gained 6 points which suggests that the improvement cannot be solely ascribed to a seasonal occurrence.
Last February the TAI increased strongly but then started losing momentum.
All the components of trade activity improved on their January 2011 positions with the sales volume index recovering by 14 points. It improved on the seasonal high of 60 in November 2011. The inventories index increased by 8 points following on the 13 index points it rose on in January. The new orders index increased by 25 points from December 2011, while supplier deliveries remained strong and increased to better than pre-festive season levels.
In February the index for current sales prices rose by a point to 64 points, which is 5 points higher than in February 2011. The input price index dropped by two index points from January 2012. “The latest indices imply that price increases have moderated. The present higher fuel prices still have to work its way through the economy,” noted SACCI.
Trade expectations advanced in February as the Trade Expectations Index (TEI) rose by 5 points to 67. Currently, trade expectations are higher than the TEI of 65 in February 2011.
The six-month outlook for all components of trade improved in February and although sales and input price expectations remained high, it was somewhat lower at 71 and 77 in February compared to 73 and 79 respectively in January.
SACCI noted that disruptions to the economy due to protest activity will be detrimental to trade conditions.
“Both the current and expected employment conditions in the trade environment have improved during February 2012 although current employment conditions remained in negative territory at 47,” said SACCI. – BuaNews
Alan Straton
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