Local mining and manufacturing data paints a mixed picture
The rand has continued to weaken today although the move is congruent with a resurgent dollar
Local mining and manufacturing data released by Statistics South Africa (STATSSA) has painted a mixed picture of our economy on a seasonal relative annualized basis.
Mining production and sales, February 2024
Year-on-year data for February 2024 showed a significant uptick in mining production, with a notable 9.9% increase. This growth is largely attributed to considerable output in iron ore, coal, and chromium ore. Specifically, iron ore production skyrocketed by 42.9%, contributing a substantial 5.1 percentage points to the overall increase.
However, the mining sector isn't without its challenges, as evidenced by the seasonally adjusted figures. While February 2024 saw a 5.0% increase compared to January, there's a slight 1.4% dip in production over the three-month period ending in February.
With regards to mineral sales, the landscape appears mixed. February 2024 saw a 2.8% year-on-year decrease in mineral sales at current prices, with PGMs, manganese ore, and coal facing the steepest declines.
Conversely, positive movements in iron ore, gold, and chromium ore sales paint a brighter picture for these markets. Iron ore, for instance, saw a 22.6% increase in sales, potentially signaling strong demand and offering a promising outlook.
Manufacturing production and sales, February 2024
In February 2024, manufacturing production saw a year-on-year increase of 4.1%, highlighting some economic resilience and growth within certain sectors. Notably, industries such as wood products, food and beverages, and chemical products were at the forefront of this expansion.
However, a closer look reveals a slight month-on-month decrease of 0.3% in seasonally adjusted manufacturing production from January to February 2024.
Manufacturing sales, saw a 1.0% increase in February 2024 compared with January of the same year, showing marginal demand for manufactured goods.
The rand
The rand has continued to weaken today although the move is congruent with a broad base of currencies against the US dollar. The dollar has continued to strengthen after yesterday’s inflation print and its hawkish (less dovish) suggestion towards the rates path in the world’s largest economy.
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