Economy and jobs recovery jittery as fears of a second COVID-19 wave looms

Economic rebound in October has brought to an end to seven months of job shedding as lockdown restrictions, associated with the coronavirus disease 2019 (COVID-19), eased.

Stanbic Bank PMI Index shows that the jump in demand for goods saw companies hire again as headline PMI rose from 56.3 in September to 59.1 in October, signalling the sharpest improvement in business conditions since the survey began in January 2014.

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“Business confidence has been on the rise over the last couple of months, courtesy of easing domestic containment measures which have boosted demand, albeit from a low base from April/May,” Jibran Qureishi, Head of Africa Research at Stanbic Bank said.

COVID Stanbic PMI Index

Jibran, however, warned that external demand may fall again following the second wave of the virus globally that has seen a return of lockdown measures.

Ireland and Czechia have become the first European countries to reenter national lockdown, as the second wave of the coronavirus pandemic began hitting Europe.

UK Prime Minister Boris Johnson said there was “no alternative” but to introduce a national lockdown – which is due to begin on Thursday – to prevent the NHS from being overwhelmed.

“With lockdowns being reimposed in some major international trading partners, new orders could ease over the coming months especially if external demand falters. Moreover, with Covid-19 cases also on the rise nationally, the risk of further containment measures pose downside risks to economic activity, prompting us to be cautious,” Qureishi said.

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