South Africa private sector contracts after four months of growth, PMI shows

South Africa's private sector contracted in May as output and new orders fell amid higher fuel prices and uncertainty linked to the Iran war, a business survey showed on Wednesday, 3 June 2026.

Source: Reuters.

The S&P Global South Africa Purchasing Managers' Index (PMI) fell to 49.6 in May from 51.6 in April. The 50 mark separates growth from contraction.

"The war in the Middle East, and increases in fuel prices in particular, took their toll on the South African private sector in May. Renewed falls in output and new orders were signalled as inflationary pressures strengthened further," said Andrew Harker, economics director at S&P Global Market Intelligence.

Output fell for the first time in five months, with firms citing higher fuel prices, the Iran war as well as stormy weather in South Africa. New orders dropped for the third time in four months and at the fastest pace so far this year.

Survey respondents said price rises linked to the Middle East conflict hurt international demand, with lower new orders reported from economies across Europe and Africa.

Despite the weaker business environment, firms were more optimistic about the outlook for the year ahead.

S&P Global said confidence was the highest so far in 2026, supported by pipelines of new work, advertising plans and hopes for more stable conditions.