JOHANNESBURG - South African manufacturing sentiment remained weak in March, with respondents in a ​purchasing managers' index (PMI) ⁠survey expressing concern about the impact of the ‌Iran war although business activity is yet to take a serious ​knock.

The seasonally-adjusted PMI sponsored by South African bank Absa edged up ​to 49.0 ​points in March from 47.4 in February, but it stayed below the neutral 50 mark.

A reading ⁠below 50 reflects an overall deterioration in business conditions for manufacturers.

Absa said in a statement that the rise in the headline index probably did not reflect stronger ​demand, ‌with new sales orders ⁠still weak.

Slower supplier deliveries likely pointed to supply chain and logistical problems, ​it said.

Those challenges could worsen ‌if global shipping routes are further ⁠disrupted by geopolitical tensions, particularly in the event of a sustained closure of the Strait of Hormuz.

The PMI results overall suggest that South Africa's manufacturing sector has not yet experienced a significant slowdown in activity due to the U.S.-Israel war against Iran, but price pressures have intensified sharply, Absa said.

Input costs have ‌been pushed higher by a weaker rand currency and ⁠higher international oil prices. With fuel prices ​going up sharply in April, cost pressures are expected to build.

A sub-index tracking expected business conditions saw the sharpest ​drop ‌on record, with respondents citing the Iran conflict's ⁠impact on costs and ​demand.