Trade conditions improve in March

March's Trade Activity Index (TAI) follows on improvement in February at 54 and January's 44 points. The index reflects current trade conditions.

“The TAI remained in positive territory and is 16 points higher than a year ago,” said SACCI on Wednesday, 14 April 2010.

The sales volumes sub-index on sales increased by two index points in March while the new orders index improved by a further two points to 57 in March. The supplier deliveries index improved to 52 in March.

“The inventory index rose to 49 in March suggesting that re-stocking may have picked up in anticipation of World Cup demand and the economic recovery over the medium term,” said SACCI.

According to SACCI the selling prices index rose to 56 while the input price index increased by two points to 63 in March.

“These price movements indicate that inflationary pressures are mounting particularly from input costs such as fuel, which is now 15.3% higher than a year ago. Substantial direct and indirect cost impacts from the implementation of high water and electricity tariffs will add to inflationary pressures in approaching months,” said the chamber.

Looking six months ahead SACCI said its respondents remain optimistic, adding that the Trade Expectations Index (TEI) stayed on a high level of 64 although it was down from the 68 in February.

“The expectations index is now probing the aftermath of the World Cup. The positive outlook still factors in an anticipated stronger economic recovery in the second half of 2010,” said SACCI.

However, sales expectations in March lost four points from the 77 in February while expectation for new orders stood at 68, further declining from January's 22.

When coming to employment, current conditions in the trade environment moved into positive territory in March as trade conditions improved further.

“The employment index rose by a further 3 points to 51 in March 2010. The employment prospects index declined somewhat to 54 in March from 57 in February duly noting prospects after the World Cup. The index remains well into positive territory for the fifth time since November 2009 and reflects greater employment opportunities in the trade sector over the medium term,” said SACCI.