In October 2020, the ABSA PMI gained 2.6 points to reach a record 60.9 points as SA’s manufacturing activity recovers. While vehicle sales improved by 3.6% m-m in October, at 38 752 units sold, vehicle sales were down -25.4% y-y. The recovery in food and beverage sales is progressing, albeit at a slow pace as September sales were down -41.7% y-y. CPI inflation increased by 30bps to 3.3% in October and PPI inflation rose 20bps to 2.7%. In December, petrol prices are expected to soften by -13c/litre (to R13.76) while diesel prices are forecast to increase by 20c/litre to R11.85/litre (coastal). The rand dipped below the R16.00/USD in November and averaged R15.54/USD during the month; on y-y basis. Private sector credit extensions quickened by 10bps to 3.2% y-y in October, signalling continued weakness in lending.
