Kenya’s private sector shows signs of revival in Oct.
Kenya’s headline PMI nudged back above the 50.0 threshold in October, hitting 50.4 from 49.7 reported a month earlier, pointing to a marginal recovery in the private sector business activity after the fallout triggered by June/July protests.
Despite this positive momentum, businesses reported input rise in input costs during the month under review even as higher material prices and tax payments against the backdrop of reduced fuel costs triggered a marginal uptick in average selling prices.
According to the Stanbic Bank Kenya PMI October survey, key metrics such as output, new orders, and job openings returned to the growth trajectory, reflecting slight overall expansion in the country’s business activity.
“The increase in output, driven by a broad stabilization of new orders, underscores the resurgence in sales and client interest, particularly in sectors such as agriculture, construction, wholesale, and retail,” stated Mulalo Madula, Senior Analyst at Standard Bank.
However, growth was tempered by declines in manufacturing and services, highlighting the mixed performance across the sectors,” noted Mulalo Madula.
The survey shows that activity levels expanded amid a broad stabilisation of new work, while employment increased for the first time in three months.
Purchasing efforts accelerated, leading to the greatest upturn in inventories since August 2023, the PMI report added.
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However, input cost pressures remained mild, prompting a slower increase in average prices charged.
“Employment levels ticked up slightly, marking the first increase since July. Further, firms have been ramping up purchasing efforts, leading to the sharpest increase in inventories since August 2023, signaling that businesses are preparing for anticipated demand,” added Mulalo Madula.
Whilst a third of the companies surveyed reported an uptick in activity since September, the increase was offset by declining activity at 29 percent of the panellists, noted Stanbic.
Additionally, sector data further muddied the picture, as upswing in agriculture, construction and wholesale and retail were countered by decreases in manufacturing and the services industry across the country.
