Data from the latest survey published by S&P Global and accessed here by MZNews indicates that the private sector ended 2022 on a moderate note, as companies saw no change in operating conditions and the growth of new orders almost stagnated.

According to the same data, the slowdown led to only slight increases in production and employment, while the acquisition of means of production fell at the sharpest rate since January.

On a positive note, cost pressures increased only slightly from November's recent low and remained moderate, and companies continued to be highly optimistic about the outlook for the coming year.

The main figure calculated by the survey is the Purchasing Managers' Index™ (PMI™). Values above 50.0 indicate an improvement in business conditions over the previous month, while values below 50.0 show a deterioration.

The main PMI indicator fell from 50.8 in November to 50.0 in December, indicating no change in the health of the private sector during the month. The latest indicator ended a sequence of growth that had been going on since February.

The decrease in the index largely reflected a sharp slowdown in new business growth towards the end of the year, with companies registering only a slight increase since November. While some companies saw an increase in the volume of orders and an increase in the number of clients, others saw a weakening of demand conditions.

Similarly, business activity grew at a slower and more modest pace in December, as companies indicated that the weak growth in new orders affected production.

In addition, the recovery remained largely concentrated in the construction industry, with data from the sector showing a drop in production in the agricultural, industrial and services sectors, as well as stagnation in the wholesale and retail trade sector.

Relatively weak demand contributed to a reduction in the purchase of means of production in December, the third in four months.

Although modest, the rate of contraction was the fastest recorded since January, leading to a slowdown in inventory growth.

Mozambican companies continued to increase their number of employees in December, amid efforts to expand production.

However, the rate of job creation was slight. The increase in production and employment helped companies to reduce outstanding work for the fifth month in a row.

Meanwhile, companies recorded only a moderate increase in the general costs of the means of production, although the inflation rate accelerated slightly from November's recent low.

In cases where costs have increased, the panelists linked this mainly to supply issues, increases in purchase prices and higher staff costs.

With inflation on costs remaining low, companies increased the prices they charged, moderately, although to a greater extent than in the previous month. It should be noted that the agricultural sector escaped the major trend and recorded falls in both input and output prices.

Finally, production expectations remained strong and recovered slightly from the previous month, with around 55% of the panelists forecasting growth for next year. (S&P Global)