Kenya: PMI improves in December
January 5, 2022
The Purchasing Managers’ Index (PMI)—produced by IHS Markit and Stanbic Kenya Bank— rose to 53.7 in December from November's 53.0. December's result marked the best reading since October 2020. As such, the index moved further above the 50-threshold, signaling a faster improvement in business conditions compared to the previous month.
December’s improvement was largely driven by a marked increase in output and new orders, on the back of stronger client demand and improved cash flow. In a bid to cope with higher demand levels, firms increased their staffing levels, albeit at a somewhat slower pace than in the prior month. Less positively, business confidence cooled markedly, weighed on by rising numbers of Covid-19 cases. On the price front, although input cost inflation eased to a three-month low, it remained elevated nonetheless, largely due to higher costs for raw materials. Meanwhile, output cost inflation rose again in December, albeit at a weaker rate.
Author: Alexandros Petropoulos,