Private sector pulse buoyed by new business activities – Markit PMI

Zambian private sector pulse for June increased signalling improved business conditions according to the latest purchasing managers index - PMI reading. Headline PMI posted 51.9 in June, down from 52.3 in May. Business activity continued to expand amid rising customer volumes and stronger demand. Firms also managed to secure greater new business at a strong pace. Companies increased their staffing levels as a result, with June data marking the first rise in workforce numbers since February this year.

Readings above 50 signal an improvement in business conditions on the previous month, while readings below 50.0 show a deterioration.

Commenting on June’s survey findings, Victor Chileshe, Head of Global Markets at Stanbic Bank said: “June PMI continues to be buoyed by new business which we see as positive, despite input price inflation.”

Firms also reported greater buying levels and stocks of purchases. Outstanding business meanwhile accumulated for the first time in 2018. Anecdotal evidence suggested that greater volumes of new business were behind the increase in work-in-hand. On the price front, overall input costs continued to increase in June. Contributors to the overall rise were higher purchase prices and staff costs, with purchase cost inflation at a five-month high. Output prices rose accordingly, with firms noting that higher cost burdens and fuel prices were key factors influencing their decision to increase average selling prices. Elsewhere, delivery times shortened, with businesses reporting that competition among suppliers was partly responsible.