Sept trade conditions show optimism

Tuesday, October 13, 2009

Pretoria - The September Trade and Conditions Survey released by the South African Chamber of Commerce and Industry (SACCI) shows optimistic figures.

Released on Tuesday, the monthly survey showed that the Trade Activity Index (TAI) which shows current trade conditions increased to 53 in September compared to 44 in August 2009.

"This is the first time since November 2007 that the TAI was in positive territory. The steady recovery in the index from a low of 32 in April 2009 is supported by the spike in the TAI in September 2009. The TAI is likely to maintain this level in the short-term as the trade environment comes to terms with more favourable trade conditions," said SACCI.

Supplier deliveries index improved to 49 in September from the 42 recorded in August.

"The further increase in the inventory index to 50 in September 2009 following a 5 point increase to 45 in August 2009, further reinforces the case for improved trade conditions," said the chamber.

The selling price index decreased to 50 from 53 in August 2009 while the input price index decreased by four points to 54 in September 2009. Inflationary pressures therefore appear to be easing again after being neutral in the August 2009 Survey.

In looking ahead to the next six months, respondents to the Trade Expectations Index (TEI) continued their optimism. This increased from the 55 recorded in August to 59 points in September.

"The TEI has been on the incline since March 2009 and the July, August and September 2009 figures were the highest TEI levels for 2009. The September 2009 TEI of 59 was also the highest recorded since September 2007 when it stood at 61.

"Sales expectations accelerated further in September 2009 to 70 from 64 in August 2009 thereby confirming improved trade prospects. All components of trade activity expectations were in positive terrain except for inventories, employment prospects and the backlog on orders received," explained the chamber.

Additionally inflationary expectations for the next six months also improved while current employment conditions in the trade environment improved.

"Current employment conditions in the trade environment improved and the employment index rose by three points to 45 in September 2009. Employment prospects also improved to 48 from 44 in August 2009 and from a very low of 39 in February this year," said SACCI.

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