The South African Chamber of Commerce and Industry's (Sacci) Trade Activity Index, which measures current trade conditions, moved laterally in September to 45 after recording 46 in August. This followed on a steady decline from 50 in February 2008 to 42 in June 2008. Although more stable, trade conditions remained depressed and hesitant in negative territory.

The sub-index on current sales volumes also moved laterally and remained in negative territory just below 50. The sales sub-index nonetheless improved from a low of 42 in June 2008. The new orders sub-index dipped by two index points in September 2008 to 42. This indicates that sales may remain weak over the short term, but is stable generally, said Sacci.

The Trade Expectations Index, which explores trade conditions six months ahead, gradually declined to a low of 46 in June 2008 from a high of 58 in February 2008. However, the TEI improved to 56 in August 2008 and slowed to 54 in September 2008.

"It appears that although the downward trend in trade conditions has turned, it remains hesitant. These expectations imply more optimistic trade prospects for 2009. Trade expectations tend to be on hold at marginally improved levels as financial conditions remain steady and cost pressures appear to be easing," said the researchers.

The sub-index on sales expectations slowed to 60 in September 2008 from 62 in August 2008. The index on expected new orders dipped by one index point in September 2008 after improving by seven index points to 58 in August 2008.

Inflationary pressures eased further as the index on selling prices declined to 62 in September 2008 after remaining at 68 in August 2008 and July 2008 - declining from 74 in June 2008.

The input price index is down to 73 in September 2008 from 77 in August 2008 after recording 81 in July 2008 and 84 in June 2008. The indices on expected input prices declined significantly by 7 points to 71 in September 2008 while expected sales prices declined by six points to 66.

"This suggests that inflation could slow faster in six months (survey period) as fuel and food prices decrease from elevated levels earlier in 2008," said Sacci.

The September 2008 employment index moved to 45 from 46 in August 2008 after being as low as 42 in June 2008. Employment prospects in the trade environment dipped again to 48 in September 2008 from 51 in August 2008 thereby crossing into negative territory again.

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