Kenya’s private sector activity during the month of April dropped to its weakest level in 11 months mainly due to the movement restrictions and extended curfew hours introduced in five counties at the end of March.
The Stanbic Bank Kenya Purchasing Managers Index, which measures the level of private sector activity, plunged to 41.5 from 50.6 in March 2021. The 41.5 reading, the lowest since May 2020, signified a sharp deterioration in the business environment.
According to the Stanbic report, the government restrictions had a huge impact on the movement of goods and services as well as demand for products. In addition, companies suffered the high cost of operation due to the rise in the price of fuel and supply shortages
The level of output from Kenyan companies fell sharply in April. Additionally, business expressed pessimism about the future. “Outlook for future activity weakened to the lowest level seen since the survey began in 2014,” read the Stanbic Report.
In order to stay afloat, businesses cut employment numbers, reduced their input purchases and others offered discounts to buyers in an effort to improve sales.