Manufacturing is losing the recovery momentum seen in the last quarter of the past year. Manufacturing production sales disappointed, with a 1.7% drop in the first quarter of 2018 from the last quarter of 2017.

Petroleum, chemical, rubber and plastic products divisions made the largest contribution to the decrease in the first quarter of 2018.

Manufacturing production decreased by 1.3% in March 2018 compared with March 2017.

Nedbank economist, Nicky Weimaar, says the weak rand and the potential trade war may result in modest recovery in the sector.

“We do think that recovery will be moderate and we think that recovery will be driven by selective industries within the manufacturing sector.

“The factors that will keep recovery modest, a stronger currency because a stronger currency will weigh on exporter, and the fact that we’ve seen increased risk creeping into the world economy through this on-going trade war between the China and the US, and also more recently, the US decision not to renew the Iran nuclear deal.”