Absa Purchasing Managers’ Index January 2026

Following a very bleak end to the year, the seasonally adjusted Absa Purchasing Managers’ Index (PMI) perked up at the start of 2026. The Absa PMI rose by a solid 8.2 points to 48.7 in January. While the index can be volatile, the magnitude of this increase is significant – although it still remained below the neutral 50-point mark. More positively, the business activity index managed to edge back above the 50-level, suggesting that production growth could have reaccelerated in Q1.

Unlike in December, all subcomponents of the headline index looked better in January relative to the previous month. Most notably, the business activity index entered growth territory. The remarkable recovery in the new sales orders index also stands out, particularly because it was driven entirely by domestic demand, given that export sales declined further in the month. Export sales values are likely to have been negatively impacted by the stronger rand. Following an unusually sharp decline in the inventories index in December, it rebounded to more normal levels in January, further supporting the headline PMI.

Encouragingly, the expected business conditions index did not deteriorate much in January, though it edged lower from 68.8 to 66.4. This remains almost 10 points above the average recorded in 2025 and suggests respondents expect a meaningful improvement in six months' time. That said, respondents’ comments suggest a sustained hesitancy in the market. For example, more quotes are being issued, but few orders are being confirmed.

While the strong rand exchange rate is a potential headwind for exporters, it is positive from a cost perspective as it lowers import costs and contributes to lower fuel prices. The purchasing price index edged up slightly in January but remained near multi-year lows.

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