Kenya’s Pri­vate Sec­tor Pulse climbs to a 26-month high

Zambian Business Times - - BUSINESS REVIEW -

THE health of the pri­vate sec­tor in Kenya in March rose to a 26-month high since Jan­uary 2016. Out­put growth quick­ened to the fastest rate since the in­cep­tion of the sur­vey in Jan­uary 2014. Mean­while, the rise in new or­ders ac­cel­er­ated to the sharpest since De­cem­ber 2016, un­der­pinned by a sur­vey-record rise in new ex­port or­ders. Re­flect­ing im­proved de­mand con­di­tions, job cre­ation quick­ened to the fastest since last May. On the price front, in­put cost in­fla­tion was sharp de­spite soft­en­ing from the pre­ced­ing month. “The Stan­bic PMI con­tin­ued to show an im­prove­ment in busi­ness con­di­tions in March. In­deed, a sur­vey record rise in out­put since data col­lec­tion be­gan back in Jan 2014, pri­mar­ily spear­headed pur­chas­ing ac­tiv­ity. More­over, re­cov­er­ing eco­nomic growth in key trad­ing part­ners such as Uganda as well as the grow­ing con­sen­sus that the in­ter­est rate cap­ping law will ei­ther be sig­nif­i­cantly mod­i­fied or abol­ished, should bode well for Kenya’s pri­vate sec­tor over the bet­ter part of this year.” Ji­bran Qureishi, Re­gional Economist E. A at Stan­bic Bank The sea­son­ally ad­justed PMI rose from 54.7 in Fe­bru­ary to 55.7 in March. This re­flected the sharpest im­prove­ment in op­er­at­ing con­di­tions since Jan­uary 2016. No­tably, the per­for­mance of Q1 2018 was the strong­est recorded in two years.

Cen­tral to the up­ward move­ment in the head­line in­dex was an­other rise in busi­ness ac­tiv­ity dur­ing March. More­over, the rate of ex­pan­sion ac­cel­er­ated to the sharpest since the se­ries be­gan in Jan­uary 2014. Ac­cord­ing to pan­elists, fa­vor­able eco­nomic con­di­tions and greater in­flows of new work were the key fac­tors be­hind out­put growth.

In line with the trend for out­put, new work at Kenyan pri­vate sec­tor firms in­creased for the fourth con­sec­u­tive month dur­ing March. More­over, the rate of ex­pan­sion quick­ened to the sharpest since De­cem­ber 2016, partly re­flect­ing a sur­vey-record rise in new ex­port or­ders. Pan­elists also at­trib­uted higher or­der book vol­umes to a higher cus­tomer turnout and im­proved de­mand.

A woman har­vest­ing tea in Kenya East Africa’s largest econ­omy.

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