(4 minutes read)
· The Mozambique Purchasing Managers’ Index (PMI™) declined in the final survey release of 2020 riding on the back of lackluster pick up of new businesses
· The good news is that there are positive signs in the horizon as output and employment are picking up at a faster rate giving optimism for the future
· There were upticks in both the output and employment indices in December as data indicated slowest decrease in business activity since March
· Job numbers rose at the strongest pace for ten months
The Mozambique Purchasing Managers’ Index (PMI™) declined in the final survey release of 2020 riding on the back of lackluster pick up of new businesses. The good news is that there are positive signs in the horizon as output and employment are picking up at a faster rate giving optimism for the future.
The headline figure derived from the PMI survey is indicating that business conditions are improving. Any value below 50 is indicative of contraction of the index. The PMI at 49.3 in December was down fractionally from 49.4 in November. The marginal deceleration in the health of the private sector economy was indicative of a weakening impact of the Covid-19 as compared to the previous months.
The downside of PMI in December was contributed by declining new orders of Mozambican firms, amid a fall in client numbers. The goods exported from Mozambique took longer to reach their destinations. The decline in demand remained modest. There were upticks in both the output and employment indices in December as data indicated the slowest decrease in business activity since March. Job numbers rose at the strongest pace for ten months.
Business expectations in December were also high, resulting from the global optimism triggered by the vaccination against the pandemic. There was price pressure on Mozambican firms due to higher cost effect and weaker exchange rate of the domestic currency against the US dollar and increase in staff salaries. These handicaps forced firms to pass on burden to the ultimate buyers.
