The Absa Purchasing Managers Index (PMI), a key barometer of confidence in the manufacturing sector, declined in May to 49.2 from 49.8 in April. This signals that manufacturing output in Q2 is contracting after an expected small bounce in Q1.

The decline in May was the fourth consecutive month that the index "signalled a deterioration in business conditions", Absa said. It also takes it further into negative territory, as 50 is the neutral level.

"In all, the average index level of business activity in the first two months of the second quarter is below the first-quarter average. This suggests that the sector may once again detract from quarterly GDP growth after an expected expansion in the first quarter," Absa said.

Economists expect that the economy grew a very moderate 0.2% in Q1 of this year, according to the median estimate of a Bloomberg forecast in mid-May, after contracting 1.3% in the final quarter of 2022. That would at least avert a recession, defined as two consecutive quarters of economic contraction.

The PMI is now indicating that any growth in the manufacturing sector in the first three months of this year has now faded and that production may now be in decline in the face of the surge in power cuts.

The outlook among purchasing managers in the sector is bleak, to say the least.

"The index tracking expected business conditions in six months' time fell to 43.7 in May, from...