The Purchasing Managers Index™ (PMI™) from Standard Bank revealed that business activity in Mozambique fell for the first time in ten months in November, standing at 49.6.
“In November, Mozambican companies saw a deterioration in operating conditions, the first in ten months, as the pace of demand continued to slow and activity levels declined,” said the document released on Thursday 7 December by Lusa.
The note explains that this decline resulted in a sharp reduction in purchasing activity, while the pace of job creation slowed to the lowest in 21 months. Even so, “companies maintained a high degree of confidence supported by the reduction in price pressures”.
The organisation also added that the growth of new business in the private sector only managed to remain constant, with the rate of expansion falling to the weakest level for ten months, and during November “a faster fall in order backlogs was recorded”.
“Subsequently, the pace of employment growth slowed to the lowest level for 21 months, with some companies even having to reduce staff numbers to cut costs. As a result, overall personnel expenditure remained largely stable, after rising in each of the previous 26 months,” he explained
Commenting on these results, Standard Bank’s chief economist, Fausio Mussá, noted that the fall in the PMI to 49.6, down from 50 in October, signals a slowdown in economic activity in the last quarter of 2023.
“Having remained below the reference value of 50, the November PMI suggests a monthly contraction in economic activity. We note that almost all the sub-indices registered a drop compared to the previous month, with seven of the 13 sub-indices remaining at the level of 50 or above, which suggests a generalised slowdown in economic activity,” said the economist, quoted in the document.