Kenya Economic Outlook
September 21, 2021Available indicators suggest that the economy expanded at a quicker rate in Q2 following Q1’s projected growth. A healthy expansion in merchandise exports in the quarter hints at stronger foreign demand, while soaring import growth in the period suggests that domestic activity also gained steam. Moreover, June logged the highest number of tourist arrivals since February 2020, boding well for the country’s hospitality sector. Turning to Q3, early data paints a bright picture. The private sector PMI came in well above Q2’s average in July–August amid rising new business growth, pointing to improving private sector conditions, while easing—albeit still-high—Covid-19 infection rates since mid-August have likely provided an additional boost. Meanwhile, domestic gasoline prices hit a 10-year high in mid-September, which is likely to push up headline inflation and could weigh on consumer spending.
Kenya Economic GrowthNext year, the economy is seen growing at a solid pace, as domestic and foreign demand shrug off the pandemic’s damage, in line with rising vaccination rates globally. That said, the spread of more infectious Covid-19 variants, coupled with political uncertainty ahead of the August 2022 presidential elections, clouds the outlook. FocusEconomics analysts project GDP growth of 5.3% in 2021 and 5.4% in 2022, which is down 0.1 percentage points from last month’s forecast.
Kenya Economy Data
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|Bond Yield||12.20||0.0 %||Dec 31|
|Exchange Rate||101.4||0.05 %||Jan 01|
|Stock Market||0.4||0.0 %||Jan 07|
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Kenya Economic News
October 5, 2021
The IHS Markit Purchasing Managers’ Index (PMI) fell to 50.4 in September from August's 51.1.
September 30, 2021
Consumer prices rose a seasonally-adjusted 0.32% in September over the previous month, accelerating from August's 0.23% rise.
September 28, 2021
At its 28 September meeting, the Monetary Policy Committee of Kenya’s Central Bank decided to leave its key rate unchanged at 7.00%, marking the tenth consecutive hold, after having cut it by 125 basis points during March–April 2020. Estimates of a strong recovery in 2021, coupled with relatively well-anchored inflation expectations, were largely behind the Bank’s decision to maintain its accommodative stance.
September 9, 2021
According to a recent release by Kenya’s Statistical Institute, GDP expanded 1.2% in annual terms in the fourth quarter of 2020, contrasting the 2.1% contraction tallied in the prior quarter, and expanding for the first time since Q1 2020.
September 3, 2021
The IHS Markit Purchasing Managers’ Index (PMI)—produced by IHS Markit and Stanbic Kenya— rose to 51.1 in August from July's 50.6.