Kenya’s private sector activity rebounded for the first time in six months in September as businesses recorded increased activity following the end of the election season.
The uptick in private sector activity saw the headline figure derived from the Stanbic Purchasing Managers’ Index™ (PMI) survey improve to 51.7 in September from 44.2 in August.
“Kenya’s business conditions saw a renewed uptick in September as concerns over post-election disruptions faded. Firms have signaled a strong rebound in output, while the sharp increase in demand also meant firms stepping up purchasing activities and stockpiling, with some firms emphasizing concerted efforts to avoid future shortages,” Mulalo Madula, Economist at Standard Bank.
According to the survey, an improvement in supply chains during the month encouraged firms to purchase more inputs. Even so, employment was largely stable amid ongoing concerns about the cost-of-living crisis
Cost pressures were particularly lifted by higher fuel prices in September, which led to an accelerated uptick in firms’ selling charges.
The survey also noted that output levels returned to growth for the first time since February, increasing at a solid pace.
Expansions were seen in the agriculture, wholesale & retail, and services categories, whereas declines were registered in manufacturing and construction.
The upturn in new orders encouraged businesses to raise their purchasing activity sharply in September, in line with a shortening of input lead times following election-led delays in the previous month. Stocks of purchases rose accordingly and at the strongest rate since April.
Despite improving slightly, the outlook for future activity remained subdued in September amid ongoing concerns surrounding the cost-of-living crisis.
Read also; Private Sector Declines in August Amidst Elections-PMI.
