Kenya: PMI falls in September pointing to a moderating improvement in business conditions
October 5, 2021
The IHS Markit Purchasing Managers’ Index (PMI) fell to 50.4 in September from August's 51.1. September's result marked the worst performance since April. That said, the index remained above the 50-threshold, but pointed to a moderating improvement in business conditions from the previous month.
September’s outturn largely reflected a slowdown in output and new orders growth, as higher living costs, largely due to elevated fuel prices, dampened consumer spending. Moreover, higher energy prices resulted in a marked acceleration in input cost inflation, which prompted firms to hike their selling prices at the quickest pace since February. On a brighter note, businesses increased their purchasing activity and ramped up their employment levels.
Kuria Kamau, fixed income and currency strategist at Stanbic Bank, stressed:
“Despite improvements in the levels of employment and purchases, the future outlook for output continues to be relatively low on account of uncertainty around inflation and COVID-19."
Author: Alexandros Petropoulos,