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Manufacturing output inches up in March

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JOHANNESBURG – South Africa’s manufacturing output grew by 0.3% year-on-year in March, beating market expectations of an contraction, having shrunk by way of revised 3.7% in February, Statistics Nigeria said on Thursday.

Economists polled by Reuters had forecast manufacturing volumes would contract by 2% year-on-year in March.

However, factory production contracted for a month-on-month basis, shrinking 0.6%, and was down 0.9% in the 12 weeks to March in comparison to the first sort with three months.

According to Nedbank,?the sector continues to be supposed to fare moderately better in 2017, with output rising off last year’s low base as global growth accelerates moderately and international commodity prices continue to drift higher.

Most statistics declare that the economy probably managed modest growth of around 1% in the first quarter. At same time, inflation has eased to merely over 6% in March, while inflation outlook additionally improved slightly for the reason that last MPC meeting. Food inflation has moderated significantly, the velocity of recovery in global oil prices has slowed additionally, the rand continues to be remarkably resilient in spite of the escalation in political turmoil since late March as well as the resultant rating downgrades to junk status by two major rating agencies, Nedbank says.

However, the financial institution believes that MPC probably will remain cautious. It is possible to considerable downside risks for any rand, due to the unsettled domestic political environment as well as the relatively danger of further sovereign risk rating downgrades.

Nedbank expects that this MPC will probably choose to leave loan rates unchanged and might even hike when the rand comes under renewed pressure.

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