In a setback for the South African manufacturing sector, the Absa Purchasing Managers’ Index slid back into contraction by 1.4 points to 49.5 points in August.

The decline reversed some of the previous months’ gains that saw the index climb above 50 points. A reading below the neutral 50-point mark indicates a contraction.

The downturn in August was led by a reversal in new sales orders, which dropped 8.5 points to 47.4.

Both domestic and export demand remain under pressure, with export activity in particular weighed down by global headwinds including tariffs.

The index improved on the employment front, reaching 48.9, but still in negative territory.