Company Announcement - After being subdued since December 2013 with the Trade Activity Index hovering around 50, trade flared up in October 2014 and the TAI measured 57.  This is nine index points better than in September and the TAI surprised by exceeding the key level of 50 by a notable margin in October.  With October traditionally being a good month for trade, the TAI was adjusted to 54 in October 2014 due to seasonal factors.  Even so it is a much improved level compared to the 48 in September 2014.

The October 2014 TAI level of 57 is one index-point below the TAI of 58 in October 2013.   The dramatic improvement in trade activity in October occurred while the economy remained subdued and major trading partners are either experiencing slower growth or struggling to gain economic momentum.  The financial position of households has also not improved.  The sales volumes and new orders sub-indices recovered further by being 13 and 11 points higher respectively in October after both indices recovered to 47 in September.  Increases in supplies, backlogs on orders and inventories supported the improvements in sales volumes and new orders. Price pressures from inputs eased as the index declined from 68 to 63 while the sales price index stayed at 55.  Although subdued trade conditions continued to contain price pressures, improvements in trade conditions, not commensurate with tight supply conditions, might create room for higher inflationary expectations.  Expectations for both higher sales and input prices increased as the indices rose from 60 and 70 to 67 and 75 correspondingly. 

The respondents to the SACCI October 2014 Trade Survey kept to their positive outlook on trade conditions for the coming six months as the seasonally adjusted expectations index improved from 62 to 65 in October 2014.  The employment conditions index in the trade environment increased from 47 in September to 52 in October 2014 while prospects for employment remained unchanged as the employment expectations sub-index remained at 53 in October 2014.