South African private sector economic activity contracted for a second consecutive month in April as power cuts and inflationary pressures weighed on businesses, a survey showed on Thursday.
The S&P Global South Africa Purchasing Managers' Index (PMI) fell to 49.6 in April from 49.7 in March. A reading above 50 shows growth.
The contraction was mainly due to capacity constraints from power cuts and supply shortages despite a slight uplift in demand, while inflationary pressures remained high and led to decreases in purchasing and employment, the survey showed.
"South African companies continued to struggle with multiple headwinds on the economy... Load shedding (power cuts), input shortages and longer lead times each acted to limit business capacity and drive another solid drop in output," said David Owen, senior economist at S&P Global Market Intelligence.
"The bleaker outlook from (power utility) Eskom in recent weeks regarding electricity supply adds to signs that business conditions could remain subdued in the near term."
The rolling power cuts in Africa's most industrialised economy have left households and businesses in the dark for up to 10 hours a day. (Reporting by Bhargav Acharya; editing by John Stonestreet)